A novel microbial fuel cell-assisted electro-permanganate process (MFC-PM) was proposed for enhanced diclofenac degradation compared to that of the permanganate oxidation process. By utilizing eco-friendly bio-electricity in situ, the MFC-PM process could activate the simultaneous anodic biological metabolism of urea and the cathodic electro-permanganate process. Density functional analysis and experimental evidence revealed the reactive manganese species (Mn(VII)aq, Mn(VI)aq, Mn(V)aq, and Mn(III)aq), generated via single electron transfer, contributed to diclofenac degradation in the cathodic chamber. The sites of diclofenac with a high Fukui index were preferable to be attacked by reactive manganese species, and diclofenac degradation was mainly accomplished through the ring hydroxylation, ring opening, and decarboxylation processes. Biological detection revealed clostridia were the primary electron donor in the anode chamber in an anaerobic environment. Furthermore, maximum output power density of 1.49 W m−3 and the optimal removal of 94.75% diclofenac were obtained within 20 min under the conditions of pH = 3.0, [DCF]0 = 60 µM, and [PM]0 = 30 µM. Diclofenac removal efficiency increased with external resistance, higher PM dosage, and lower catholyte pH. In addition, the MFC-PM process displayed excellent applicability in urine and other background substances. The MFC-PM process provided an efficient and energy-free bio-electricity catalytic permanganate oxidation technology for enhancing diclofenac degradation.