The oxazolomycins (OZMs) are a growing family of antibiotics produced by several Streptomyces species that show diverse and important antibacterial, antitumor, and anti-human immunodeficiency virus activity. Oxazolomycin A is a peptide-polyketide hybrid compound containing a unique spiro-linked beta-lactone/gamma-lactam, a 5-substituted oxazole ring. The oxazolomycin biosynthetic gene cluster (ozm) was identified from Streptomyces albus JA3453 and localized to 79.5-kb DNA, consisting of 20 open reading frames that encode non-ribosomal peptide synthases, polyketide synthases (PKSs), hybrid non-ribosomal peptide synthase-PKS, trans-acyltransferases (trans-ATs), enzymes for methoxymalonyl-acyl carrier protein (ACP) synthesis, putative resistance genes, and hypothetical regulation genes. In contrast to classical type I polyketide or fatty acid biosynthases, all 10 PKS modules in the gene cluster lack cognate ATs. Instead, discrete ATs OzmM (with tandem domains OzmM-AT1 and OzmM-AT2) and OzmC were equipped to carry out all of the loading functions of both malonyl-CoA and methoxymalonyl-ACP extender units. Strikingly, only OzmM-AT2 is required for OzmM activity for OZM biosynthesis, whereas OzmM-AT1 seemed to be a cryptic AT domain. The above findings, together with previous results using isotope-labeled precursor feeding assays, are assembled for the OZM biosynthesis model to be proposed. The incorporation of both malonyl-CoA (by OzmM-AT2) and methoxymalonyl-ACP (by OzmC) extender units seemed to be unprecedented for this class of trans-AT type I PKSs, which might be fruitfully manipulated to create structurally diverse novel compounds.