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Litosetoenins A–E (1–5), five new ring-rearranged serrulatane-type diterpenoids with a common tricyclo[3.0.4]decane core, along with a known diterpenoid glycoside (6), a related known diterpenoid (7), and four known sesquiterpenoids (8–11), were isolated from a Balinese soft coral Litophyton setoensis. Spirolitosetoenin A (5a) and isospirolitosetoenin A (5b), featuring an unprecedented spiro[4,5]decane core, were obtained after treatment of compound 5 with HCl in methanol. The structures of new compounds were elucidated by extensive spectroscopic analysis, quantum mechanical nuclear magnetic resonance approach, and chemical methods. A plausible biosynthetic pathway involving an unusual divergent biogenesis was proposed., This work was financially supported by the National Key Research and Development Program of China (no. 2018YFC0310903), the Natural Science Foundation of China (no. 81991521), the SKLDR/SIMM Project (no. SIMM2103ZZ-06), the Indonesian Ministry of Research and Technology/National Agency for Research and Innovation (WCR grant no. 91/UN48.16/LT/2020), and the Ministerio de Ciencia e Innovación (MICIN PID2019-109476RB-C21). The manuscript was proof-edited by Guido Jones, funded by Cabildo de Tenerife under the TFinnova Programme, supported by MEDI and FDCAN. We thank Prof. X.-B. Li from Hainan University for the identification of the soft coral material. SGAI-CSIC and CESGA (Spain) provided access to supercomputing facilities.