Pimelic acid formation for biotin biosynthesis in Bacillus subtilis has been proposed to involve a cytochrome P450 encoded by the gene bioI. We have subcloned biol and overexpressed the encoded protein, Biol. A purification protocol was developed utilizing ion exchange, gel filtration, and hydroxyapatite chromatography. Investigation of the purified BioI by UV-visible spectroscopy revealed spectral properties characteristic of a cytochrome P450 enzyme. BioI copurifies with acylated Escherichia coli acyl carrier protein (ACP), suggesting that in vivo a fatty acid substrate may be presented to BioI as an acyl-ACP. A combination of electrospray mass spectrometry of the intact acyl-ACP and GCMS indicated a range of fatty acids were bound to the ACP. A catalytically active system has been established employing E. coli flavodoxin reductase and a novel, heterologous flavodoxin as the redox partners for BioI. In this system, BioI cleaves a carbon-carbon bond of an acyl-ACP to generate a pimeloyl-ACP equivalent, from which pimelic acid is isolated after base-catalyzed saponification. A range of free fatty acids have also been explored as potential alternative substrates for BioI, with C16 binding most tightly to the enzyme. These fatty acids are also metabolized to dicarboxylic acids, but with less regiospecificity than is observed with acyl-ACPs. A possible mechanism for this transformation is discussed. These results strongly support the proposed role for BioI in biotin biosynthesis. In addition, the production of pimeloyl-ACP explains the ability of BioI to function as a pimeloyl CoA source in E. coli, which, unlike B. subtilis, is unable to utilize free pimelic acid for biotin production.