Nonheme diiron monooxygenases (NHDMs) interact with nonribosomal peptide synthetase (NRPS) assembly lines to install β-hydroxylations at thiolation-domain-bound amino acids during nonribosomal peptide biosynthesis. The high potential of this enzyme family to diversify the products of engineered assembly lines is disproportionate to the currently small knowledge about their structures and mechanisms of substrate recognition. Here, we report the crystal structure of FrsH, the NHDM which catalyzes the β-hydroxylation of l-leucines during biosynthesis of the depsipeptide G protein inhibitor FR900359. Using biophysical approaches, we provide evidence that FrsH interacts with the cognate monomodular NRPS FrsA. By AlphaFold modeling and mutational studies, we detect and examine structural features within the assembly line crucial to recruit FrsH for leucine β-hydroxylation. These are, in contrast to cytochrome-dependent NRPS β-hydroxylases, not located on the thiolation domain, but on the adenylation domain. FrsH can be functionally substituted by homologous enzymes from biosyntheses of the cell-wall-targeting antibiotics lysobactin and hypeptin, indicating that these features are generally applicable to members of the family of trans-acting NHDMs. These insights give important directions for the construction of artificial assembly lines to yield bioactive and chemically complex peptide products.