DtpC was isolated from the ditryptophenaline biosynthetic pathway found in filamentous fungi as a cytochrome P450 (P450) that catalyzes the dimerization of diketopiperazines. More recently, several similar P450s were discovered. While a vast majority of such P450s generate asymmetric diketopiperazine dimers, DtpC and other fungal P450s predominantly catalyze the formation of symmetric dimer products. Dimeric compounds can have interesting biological activities, and the mode of dimerization can substantially affect their bioactivities substantially. Here, we set out to examine the mechanism and scope of diketopiperazine dimerization catalyzed by DtpC using both chemically modified substrate molecules and DtpC mutants that were selected by the screening of randomly mutated recombinant variants. Use of N1- and N10-methylated diketopiperazine substrates supports the proposal that the initial radical formation occurs by extraction of the N1 indole nitrogen for this fungal P450 dimerase. Further in vitro studies revealed that DtpC was capable of accepting a range of structurally variable substrates, including N-demethylated diketopiperazines, and forming symmetric homo- and heterodimeric products. Moreover, the introduction of single mutations identified through the screening of random mutants at and around the substrate-binding pocket led to the conversion of DtpC into a catalyst that predominantly generated asymmetric dimers of various diketopiperazines. The versatility of DtpC can serve as a good starting point for directed evolution of P450s that can serve as versatile catalysts for generation of various dimers of not only diketopiperazines derived from standard and nonstandard amino acids but also possibly structurally more divergent analogs of diketopiperazines.