Staphylococcus aureus requires iron for growth and utilizes heme as a source of iron during infection. Staphylococcal surface proteins capture hemoglobin, release heme from hemoglobin and transport this compound across the cell wall envelope and plasma membrane into the bacterial cytoplasm. Here we show that Staphylococcus aureus isdG and isdI encode cytoplasmic proteins with heme binding properties. IsdG and IsdI cleave the tetrapyrrol ring structure of heme in the presence of NADPH cytochrome P450 reductase, thereby releasing iron. Further, IsdI complements the heme utilization deficiency of a Corynebacterium ulcerans heme oxygenase mutant, demonstrating in vivo activity of this enzyme. Although Staphylococcus epidermidis, Listeria monocytogenes, and Bacillus anthracis encode homologues of IsdG and IsdI, these proteins are not found in other bacteria or mammals. Thus, it appears that bacterial pathogens evolved different strategies to retrieve iron from scavenged heme molecules and that staphylococcal IsdG and IsdI represent examples of bacterial heme-oxygenases.