The electronic structures of key species involved in methane hydroxylation performed by the hydroxylase component of soluble methane monooxygenase (sMMO), as proposed previously on the basis of high-level density functional theory, were investigated. The reaction starts with initial approach of methane at one of the bridging oxo atoms in intermediate Q, a di(mu-oxo)diiron(IV) unit. This step is accompanied by a proton-coupled outer-sphere transfer of the first electron from a C-H a-bond in methane to one of the metal centers. The second electron transfer, also an outer-sphere electron transfer process, occurs along a two-component reaction pathway. Both redox reactions are strongly coupled to structural distortions of the diiron core. The electronic consequence and driving force of these distortions are intuitively explained by using the computed Kohn-Sham orbitals in the broken-symmetry framework to incorporate the experimentally observed antiferromagnetic coupling of the unpaired electrons at the metal centers. The broken-symmetry orbital scheme is essential for describing the C-H bond activation process in a consistent and complete manner, enabling derivation of both an intuitive and quantitative understanding of the most salient electronic features that govern the details of the hydroxylation.