One of the primary sources of enzyme instability is protein oxidative modification triggering activity loss or denaturation. We show here that the side chain of Cys108 is the main site undergoing stress-induced oxidation in Trigonopsis variabilis D-amino acid oxidase, a flavoenzyme employed industrially for the conversion of cephalosporin C. High-resolution anion-exchange chromatography was used to separate the reduced and oxidized protein forms, which constitute, in a molar ratio of about 3:1, the active biocatalyst isolated from the yeast. Comparative analysis of their tryptic peptides by electrospray tandem mass spectrometry allowed unequivocal assignment of the modification as the oxidation of Cys108 into cysteine sulfinic acid. Cys108 is likely located on a surface-exposed protein region within the flavin adenine dinucleotide (FAD) binding domain, but remote from the active center. Its oxidized side chain was remarkably stable in solution, thus enabling the relative biochemical characterization of native and modified enzyme forms. The oxidation of Cys108 causes a global conformational response that affects the protein environment of the FAD cofactor. In comparison with the native enzyme, it results in a fourfold-decreased specific activity, reflecting a catalytic efficiency for reduction of dioxygen lowered by about the same factor, and a markedly decreased propensity to aggregate under conditions of thermal denaturation. These results open up unprecedented routes for stabilization of the oxidase and underscore the possible significance of protein chemical heterogeneity for biocatalyst function and stability.