The production of odiferous metabolites, such as 2-methly- isoborneol (MIB), is a major concern for water utilities worldwide. Although MIB has no known biological function, the presence of the earthy/musty taste and odor attributed to this compound result in the reporting of numerous complaints by consumers, which undermines water utility performance and the safe and adequate provision of potable waters. Cyanobacteria are the major producers of MIB in natural waters, by mechanisms that have heretofore remained largely unstudied. To investigate the fundamental biological mechanism of MIB biosynthesis in cyanobacteria, the genome of a MIB-producing Pseudanabaena limnetica was sequenced using Next Generation Sequencing, and the recombinant proteins derived from the putative MIB biosynthetic genes were biochemically characterized. We demonstrate that the biosynthesis of MIB in cyanobacteria is a result of 2 key reactions: 1)a S-adenosylmethionine-dependent methylation of the monoterpene precursor geranyl diphosphate (GPP) to 2-methyl-GPP catalyzed by geranyl diphosphate 2-methyltransferase (GPPMT) and 2) further cyclization of 2-methyl- GPP to MIB catalyzed by MIB synthase (MIBS) as part of a MIB operon. Based on a comparison of the component MIB biosynthetic genes in actinomycetes and cyanobacterial organisms, we hypothesize that there have been multiple rearrangements of the genes in this operon.