Abstract CYP152 peroxygenases catalyze decarboxylation and hydroxylation of fatty acids using H 2 O 2 as cofactor. To understand the molecular basis for the chemo‐ and regioselectivity of these unique P450 enzymes, we analyze the activities of three CYP152 peroxygenases (OleT JE , P450 SPα , P450 BSβ ) towards cis‐ and trans‐dodecenoic acids as substrate probes. The unexpected 6S‐hydroxylation of the trans‐isomer and 4R‐hydroxylation of the cis‐isomer by OleT JE , and molecular docking results suggest that the unprecedented selectivity is due to OleT JE ’s preference of C2−C3 cis‐configuration. In addition to the common epoxide products, undecanal is the unexpected major product of P450 SPα and P450 BSβ regardless of the cis/trans‐configuration of substrates. The combined H 2 18 O 2 tracing experiments, MD simulations, and QM/MM calculations unravel an unusual mechanism for Compound I‐mediated aldehyde formation in which the active site water derived from H 2 O 2 activation is involved in the generation of a four‐membered ring lactone intermediate. These findings provide new insights into the unusual mechanisms of CYP152 peroxygenases.