Cryptochrome is a blue light receptor that acts as a sensor for the geomagnetic field and assists many animals in long-range navigation. The magnetoreceptor function arises from light-induced formation of a radical pair through electron transfer between a flavin cofactor (FAD) and a triad of tryptophan residues. Here, this electron transfer is investigated by quantum chemical and classical molecular dynamics calculations. The results reveal how sequential electron transfer, assisted by rearrangement of polar side groups in the cryptochrome interior, can yield a FAD-Trp radical pair state with the FAD and Trp partners separated beyond a critical distance. The large radical pair separation reached establishes cryptochrome's sensitivity to the geomagnetic field through weakening of distance-dependent exchange and dipole-dipole interactions. It is estimated that the key secondary electron transfer step can overcome in speed both recombination (electron back-transfer) and proton transfer involving the radical pair reached after primary electron transfer.