Spectroscopic methods and density functional theory (DFT) calculations are used to determine the geometric and electronic structure of Cu-Z degrees, an intermediate form of the Cu4S active site of nitrous oxide reductase (N2OR) that is observed in single turnover of fully reduced N2OR with N2O. Electron paramagnetic resonance (EPR), absorption, and magnetic circular dichroism (MCD) spectroscopies show that Cu-Z degrees is a 1-hole (i.e., 3Cu(I)Cu(II)) state with spin density delocalized evenly over Cu-I and Cu-IV. Resonance Raman spectroscopy shows two Cu-S vibrations at 425 and 413 cm(-1), the latter with a -3 cm(-1) O-18 solvent isotope shift. DFT calculations correlated to these spectral features show that Cu-Z degrees has a terminal hydroxide ligand coordinated to Cu-IV, stabilized by a hydrogen bond to a nearby lysine residue. Cu-Z degrees can be reduced via electron transfer from Cu-A using a physiologically relevant reductant. We obtain a lower limit on the rate of this intramolecular electron transfer (IET) that is >104 faster than the unobserved IET in the resting state, showing that Cu-Z degrees is the catalytically relevant oxidized form of N2OR Terminal hydroxide coordination to Cuw in the Cu-Z degrees intermediate yields insight into the nature of N2O binding and reduction, specifying a molecular mechanism in which N2O coordinates in a jt-1,3 fashion to the fully reduced state, with hydrogen bonding from Lys397, and two electrons are transferred from the fully reduced ft4S(2)bridged tetranuclear copper cluster to N2O via a single Cu atom to accomplish N-O bond cleavage.