The nonribosomal enterotoxin tilivalline was the first naturally occurring pyrrolobenzodiazepine to be linked to disease in the human intestine. Since the producing organism Klebsiella oxytoca is part of the intestinal microbiota and the pyrrolobenzodiazepine causes the pathogenesis of colitis it is important to understand the biosynthesis and regulation of tilivalline activity. Here we report the biosynthesis of tilivalline and show that this nonribosomal peptide assembly pathway initially generates tilimycin, a simple pyrrolobenzodiazepine with cytotoxic properties. Tilivalline results from the non-enzymatic spontaneous reaction of tilimycin with biogenetically generated indole. Through a chemical total synthesis of tilimycin we could corroborate the predictions made about the biosynthesis. Production of two cytotoxic pyrrolobenzodiazepines with distinct functionalities by human gut resident Klebsiella oxytoca has important implications for intestinal disease.