The ever-increasing bacterial genomic repositories reveal a great number of uncharacterized biosynthetic gene clusters, representing a tremendous resource for natural product discovery. Genome mining of the marine Streptomyces sp. NA03103 indicates the presence of an orphan nonribosomal peptide synthetase (NRPS) gene cluster (asm), to which there are no homologous gene clusters in the public genome databases. Heterologous expression of the asm gene cluster in the S. lividans SBT18 strain led to the discovery of two novel cyclopeptides, ashimides A and B (1 and 2), with 2 showing cytotoxic activity. In addition, we use bioinformatic analysis, gene inactivation and stable isotope labelling experiments, as well as in vitro biochemical assays, to present a coherent and novel assembly line for ashimide biosynthesis, featuring an unusual desaturation, halogenation and cyclization cascade catalyzed by a P450 monooxygenase and a FAD-dependent halogenase.