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Abstract Hemoproteins have recently emerged as promising biocatalysts for new-to-nature carbene transfer reactions. However, mechanistic understanding of the interplay between productive and unproductive pathways in these processes is limited. Using spectroscopic, structural, and computational methods, we investigate the mechanism of a myoglobin-catalyzed cyclopropanation reaction with diazoketones. These studies shed light on the nature and kinetics of key catalytic steps in this reaction, including the formation of an early heme-bound diazo complex intermediate, the rate-determining nature of carbene formation, and the cyclopropanation mechanism. Our analyses further reveal the existence of a complex mechanistic manifold for this reaction that includes a competing pathway resulting in the formation of an N-bound carbene adduct of the heme cofactor, which was isolated and characterized by X-ray crystallography, UV-Vis, and Mössbauer spectroscopy. This species can regenerate the active biocatalyst, constituting a non-productive, yet non-destructive detour from the main catalytic cycle. These findings offer a valuable framework for both mechanistic analysis and design of hemoprotein-catalyzed carbene transfer reactions.