Cytochrome P450 enzyme (CYP)-catalyzed functional group transformations are pivotal in the biosynthesis of metabolic intermediates and products, as exemplified by the CYP-catalyzed C7-hydroxylation and the subsequent C7-C8 bond cleavage reaction responsible for the biosynthesis of the well-known antitumor monoterpene indole alkaloid (MIA) camptothecin. To determine the key amino acid residues responsible for the catalytic selectivity of the CYPs involved in MIA biosynthesis, we characterized the enzymes CYP72A728 and CYP72A729 as stereoselective 7-deoxyloganic acid 7-hydroxylases (7DLHs). We then conducted a comparative analysis of the amino acid sequences and the predicted structures of the CYP72A homologs involved in camptothecin biosynthesis, as well as those of the CYP72A homologs implicated in the pharmaceutically significant MIAs biosynthesis in Catharanthus roseus. The crucial amino acid residues for the catalytic selectivity of the CYP72A-catalyzed reactions were identified through fragmental and individual residue replacement, catalytic activity assays, molecular docking, and molecular dynamic simulations analysis. The fragments 1 and 3 of CYP72A565 were crucial for its C7-hydroxylation and C7-C8 bond cleavage activities. Mutating fragments 1 and 2 of CYP72A565 transformed the bifunctional CYP72A565 into a monofunctional 7DLH. Evolutionary analysis of the CYP72A homologs suggested that the bifunctional CYP72A in MIA-producing plants may have evolved into a monofunctional CYP72A. The gene pairs CYP72A728-CYP72A610 and CYP72A729-CYP72A565 may have originated from a whole genome duplication event. This study provides a molecular basis for the CYP72A-catalyzed hydroxylation and C-C bond cleavage activities of CYP72A565, as well as evolutionary insights of CYP72A homologs involved in MIAs biosynthesis.