Fungal polyisoprenylated benzophenones typically exhibit potent biological activities. In our previous research, a series of novel polyisoprenylated benzophenones, namely lithocarols A-F, were discovered from the deep-sea fungus Phomopsis lithocarpus FS508, and the lit gene cluster responsible for lithocarol biosynthesis was identified. Nevertheless, the crucial genes and catalytic mechanism underlying xanthone scaffold formation in lithocarols remain unclear. In this study, we employed gene knockout, overexpression, in vitro biochemical assays, and heterologous expression in Aspergillus oryzae to functionally characterize the key biosynthetic genes. Our results demonstrate that a two-enzyme cascade, consisting of the Baeyer-Villiger monooxygenase LitI and the short-chain dehydrogenase LitQ, is indispensable for xanthone ring formation in lithocarol biosynthesis. Additionally, overexpression of the prenyltransferase-encoding litM gene enhanced the yield of lithocarol F by 8.93 ± 1.02-fold. This study provides novel insights into the biosynthetic logic of xanthone scaffolds in fungal polyisoprenylated benzophenones, and presents a biosynthetic strategy for improving lithocarol production.