We have characterized the gene encoding fatty acid alpha-hydroxylase, a cytochrome P450 (P450) enzyme, from Sphingomonas paucimobilis. A database homology search indicated that the deduced amino acid sequence of this gene product was 44% identical to that of the ybdT gene product that is a 48 kDa protein of unknown function from Bacillus subtilis. In this study, we cloned the ybdT gene and characterized this gene product using a recombinant enzyme to clarify function of the ybdT gene product. The carbon monoxide difference spectrum of the recombinant enzyme showed the characteristic one of P450. In the presence of H2O2, the recombinant ybdT gene product hydroxylated myristic acid to produce beta-hydroxymyristic acid and alpha-hydroxymyristic acid which were determined by high-performance liquid chromatography (HPLC) and gas chromatography-mass spectrometry. The amount of these products increased with increasing reaction period and amount of H2O2 in the reaction mixture. The amount of beta-hydroxyl product was slightly higher than that of alpha-hydroxyl product at all times during the reaction. However, no reaction products were detected at any time or at any concentration of H2O2 when heat-inactivated enzyme was used. HPLC analysis with a chiral column showed that the beta-hydroxyl product was nearly enantiomerically pure R-form. These results suggest that this P450 enzyme is involved in a novel biosynthesis of beta-hydroxy fatty acid.