Ergothioneine is a histidine thio-derivative isolated in 1909. In ergothioneine biosynthesis, the combination of a mononuclear non-heme iron enzyme catalyzed oxidative C-S bond formation reaction and a PLP-mediated C-S lyase (EgtE) reaction results in a net sulfur transfer from cysteine to histidine side-chain. This demonstrates a new sulfur transfer strategy in the biosynthesis of sulfur-containing natural products. Due to difficulties associated with the overexpression of Mycobacterium smegmatis EgtE protein, the proposed EgtE functionality remained to be verified biochemically. In this study, we have successfully overexpressed and purified M. smegmatis EgtE enzyme and evaluated its activities under different in vitro conditions: C-S lyase reaction using either thioether or sulfoxide as a substrate in the presence or absence of reductants. Results from our biochemical characterizations support the assignment of sulfoxide 4 as the native EgtE substrate and the involvement of a sulfenic acid intermediate in the ergothioneine C-S lyase reaction.