Isopenicillin N synthase (IPNS), a non-heme iron oxidase central to penicillin and cephalosporin biosynthesis, catalyzes an energetically demanding chemical transformation to produce isopenicillin N from the tripeptide delta-(l-alpha-aminoadipoyl)-l-cysteinyl-d-valine (ACV). We describe the synthesis of two cyclopropyl-containing tripeptide analogues, delta-(l-alpha-aminoadipoyl)-l-cysteinyl-beta-methyl-d-cyclopropylglycine and delta-(l-alpha-aminoadipoyl)-l-cysteinyl-d-cyclopropylglycine, designed as probes for the mechanism of IPNS. We have solved the X-ray crystal structures of these substrates in complex with IPNS and propose a revised mechanism for the IPNS-mediated turnover of these compounds. Relative to the previously determined IPNS-Fe(II)-ACV structure, key differences exist in substrate orientation and water occupancy, which allow for an explanation of the differences in reactivity of these substrates.