Density functional theory calculations are presented on the catalytic properties of a horseradish peroxidase mutant whereby the axial nitrogen atom is replaced by phosphorus. This mutant has never been studied experimentally and only one theoretical report on this system is known (de Visser, S. P. J. Phys. Chem. B 2006, 110, 20759-20761). Thus, a one-atom substitution in horseradish peroxidase changes the properties of the catalytic center of the enzyme to more cytochrome P450-type qualities. In particular, the phosphorus-substituted horseradish peroxidase mutant reacts with substrates via a unique reactivity pattern, whereby alkanes are regioselectively hydroxylated even in the presence of a double bond. Reaction barriers of propene epoxidation and hydroxylation are almost identical to ones observed for a cytochrome P450 catalyst and significantly higher than those obtained for a horseradish peroxidase catalyst. It is shown that the regioselectivity difference is entropy and thermally driven and that the electron-transfer processes that occur during the reaction mechanism follow cytochrome P450-type patterns in the hydroxylation reaction.