The catalytic oxidation of triphenylphosphine in the presence of dioxygen by the diiron(II) complex [Fe-2(mu-O-2-CArTol)(2)(Me(3)TACN)(2)(MeCN)(2)](OTf)(2) (1), where (-O2CArTol) = 2,6-di(p-tolyl)benzoate and Me(3)TACN = 1,4,7-trimethyl-1,4,7-triazacyclononane, has been investigated. The corresponding diiron(III) complex, [Fe-2(mu-O)(mu-O2CArTol)(2)(Me(3)TACN)(2)](OTf)(2) (2), the only detectable iron-containing species during the course of the reaction, can itself promote the reaction. Phosphine oxidation is coupled to the catalytic oxidation of THF solvent to afford, selectively, the C-C bond-cleavage product 3-hydroxypropylformate, an unprecedented transformation. After consumption of the phosphine, solvent oxidation continues but results in the products 2-hydroperoxytetrahydrofuran, butyrolactone, and butyrolactol. The similarities of the reaction pathways observed in the presence and absence of catalyst, as well as O-18 labeling, solvent dependence, and radical probe experiments, provide evidence that the oxidation is initiated by a metal-centered H-atom abstraction from THF. A mechanism for catalysis is proposed that accounts for the coupled oxidation of the phosphine and the THF ring-opening reaction.