Cytochrome P450 27A1 (P450 27A1) is an important metabolic enzyme involved in bile acid biosynthesis and the activation of vitamin D3 in mammals. Recombinant P450 27A1 heterologously expressed in Escherichia coli was found to be copurified with phospholipids (PLs). The PL content varied in different preparations and was dependent on the purification protocol. A link between the increased amounts of PLs and deterioration of the enzyme substrate binding properties was also observed. Tandem negative ionization mass spectrometry identified phosphatidylglycerol (PG) as the major PL copurified with P450 27A1. Subsequent reconstitution of P450 into exogenous PG vesicles assessed the effect of this contamination on substrate binding and enzyme activity. Two other PLs, phosphatidylethanolamine (PE) and phosphatidylserine (PS), were also tested. PG and PE increased the Kd for 5beta-cholestane-3alpha,7alpha,12alpha-triol and cholesterol binding, whereas PS had no effect on either substrate binding. PG and PE did not significantly alter 5beta-cholestane-3alpha,7alpha,12alpha-triol hydroxylase activity and even stimulated cholesterol hydroxylase activity. PS inhibited 5beta-cholestane-3alpha,7alpha,12alpha-triol hydrolyase activity and had no effect on cholesterol hydroxylase activity. Our study shows the potential for PLs to regulate the activity of P450 27A1 in vivo and alter the amount of cholesterol degraded through the "classical" and "alternative" bile acid biosynthetic pathways.