Acinetobacter calcoaceticus NCIB 8250 utilizes phenol as sole source of carbon and energy via an ortho-cleavage pathway. The presence of ethanol in mixed substrate cultivations repressed the utilization of phenol. In fed batch cultivation the phenol tolerance was increased at least 2-fold. Maximum degradation rates of 150 mg phenol/(l h) and 280 mg phenol/(g h), respectively were observed. Phenol hydroxylase is induced by its substrate and in parallel the catechol-1,2-dioxygenase is detectable. The presence of active phenol hydroxylase is strongly connected with the phenol degradation. Using a spectrophotometric enzyme assay the partially purified phenol hydroxylase was characterized with respect to kinetic parameters. The apparent K,,, values for phenol, FAD and NADPH were estimated to be 147 VM, 35 PM and 416 FM, respectively. Both FAD and NADPH were essential for maximum activity of the cytoplasmically localized enzyme. No substrate inhibition of phenol hydroxylase by phenol was observed up to 0.8 mM. The pH and temperature optima were pH 7.8 and 33 "C, respectively. The partially purified enzyme showed a broad substrate specificity. It hydroxylated the three isomeric cresols, chlorophenols and methylated chlorophenols. Pyrogallol, 3,4-dihydroxy-~-phenylalanine and resorcinol were oxygenated with higher rates than phenol. With the exception of phenol all other enzyme substrates tested did not serve as growth substrates.