The reversible interconversion of formate (HCOO) and carbon dioxide (CO) is catalyzed by formate dehydrogenase (FDH, EC 1.17.1.9). This enzyme can be used as a first step in the utilization of CO as carbon substrate for production of high-in-demand chemicals. However, comparison and categorization of the very diverse group of FDH enzymes has received only limited attention. With specific emphasis on FDH catalyzed CO reduction to HCOO, we present a novel classification scheme for FDHs based on protein sequence alignment and gene organization analysis. We show that prokaryotic FDHs can be neatly divided into six meaningful sub-types. These sub-types are discussed in the context of overall structural composition, phylogeny of the gene segment organization, metabolic role, and catalytic properties of the enzymes. Based on the available literature, the influence of electron donor choice on the efficacy of FDH catalyzed CO reduction is quantified and compared. This analysis shows that methyl viologen and hydrogen are several times more potent than NADH as electron donors. Hence, the new FDH classification scheme and the electron donor analysis provide an improved base for developing FDH-facilitated CO reduction as a viable step in the utilization of CO as carbon source for green production of chemicals.