Peroxy radicals formed by addition of OH and O-2 to the olefinic carbon atoms in methacrolein react with NO to form methacrolein hydroxy nitrate and hydroxyacetone. We observe that the ratio of these two compounds, however, unexpectedly decreases as the lifetime of the peroxy radical increases. We propose that this results from an isomerization involving the 1,4-H-shift of the aldehydic hydrogen atom to the peroxy group. The inferred rate (0.5 +/- 0.3 s(-1) at T = 296 K) is consistent with estimates obtained from the potential energy surface determined by high level quantum calculations. The product, a hydroxy hydroperoxy carbonyl radical, decomposes rapidly, producing hydroxyacetone and re-forming OH. Simulations using a global chemical transport model suggest that most of the methacrolein hydroxy peroxy radicals formed in the atmosphere undergo isomerization and decomposition.