Lignin is the second most abundant constituent of the cell wall of vascular plants, where it protects cellulose towards hydrolytic attack by saprophytic and pathogenic microbes. Its removal represents a key step for carbon recycling in land ecosystems, as well as a central issue for industrial utilization of plant biomass. The lignin polymer is highly recalcitrant towards chemical and biological degradation due to its molecular architecture, where different non-phenolic phenylpropanoid units form a complex three-dimensional network linked by a variety of ether and carbon–carbon bonds. Ligninolytic microbes have developed a unique strategy to handle lignin degradation based on unspecific one-electron oxidation of the benzenic rings in the different lignin substructures by extracellular haemperoxidases acting synergistically with peroxide-generating oxidases. These peroxidases posses two outstanding characteristics: (i) they have unusually high redox potential due to haem pocket architecture that enables oxidation of non-phenolic aromatic rings, and (ii) they are able to generate a protein oxidizer by electron transfer to the haem cofactor forming a catalytic tryptophanyl-free radical at the protein surface, where it can interact with the bulky lignin polymer. The structure–function information currently available is being used to build tailor-made peroxidases and other oxidoreductases as industrial biocatalysts.