Cytochrome P450 peroxygenases use hydrogen peroxide to hydroxylate long-chain fatty acids by bypassing the use of O2 and a redox partner. Among the peroxygenases, P450OleT uniquely performs decarboxylation of fatty acids and production of terminal olefins. This route taken by P450OleT is intriguing, and its importance is augmented by the practical importance of olefin production. As such, this mechanistic choice merits elucidation. To address this puzzle, we use hybrid QM/MM calculations and MD simulations for the OleT enzyme as well as for the structurally analogous enzyme, P450BSβ. The study of P450OleT reveals that the protonated His85 in the wild-type P450OleT plays a crucial role in steering decarboxylation activity by stabilizing the corresponding hydroxoiron(IV) intermediate (Cpd II). In contrast, for P450BSβ in which Q85 replaces H85, the respective Cpd II species is unstable and it reacts readily with the substrate radical by rebound, producing hydroxylation products. As shown, this single-site difference creates in P450OleT a local electric field (LEF), which is significantly higher than that in P450BSβ. In turn, these LEF differences are responsible for the different stabilities of the respective Cpd II/radical intermediates and hence for different functions of the two enzymes. P450BSβ uses the common rebound mechanism and leads to hydroxylation, whereas P450OleT proceeds via decarboxylation and generates terminal olefins. Olefin production projects the power of a single residue to alter the LEF and the enzyme’s function. © 2022 American Chemical Society