Activation of a silent gene cluster in Streptomyces nodosus leads to synthesis of a cinnamoyl-containing non-ribosomal peptide (CCNP) that is related to skyllamycins. This novel CCNP was isolated and its structure was interrogated using mass spectrometry and nuclear magnetic resonance spectroscopy. The isolated compound is an oxidised skyllamycin A in which an additional oxygen atom is incorporated in the cinnamoyl side-chain in the form of an epoxide. The gene for the epoxide-forming cytochrome P450 was identified by targeted disruption. The enzyme was overproduced in Escherichia coli and a 1.43 Å high-resolution crystal structure was determined. This is the first crystal structure for a P450 that forms an epoxide in a substituted cinnamoyl chain of a lipopeptide. These results confirm the proposed functions of P450s encoded by biosynthetic gene clusters for other epoxidized CCNPs and will assist investigation of how epoxide stereochemistry is determined in these natural products.