Hydrolase activity from human liver and small intestine microsomes was compared with that of recombinant human carboxylesterases, hCE-1 and hCE-2. Although both hCE-1 and hCE-2 are present in human liver, the dominant component was found to be hCE-1, whereas the hydrolase activity of the human small intestine was found to be predominantly hCE-2. hCE-2 has a limited ability to hydrolyze large acyl compound substrates. Interestingly, propranolol derivatives, good substrates for hCE-2, were easily hydrolyzed by substitution of the methyl group on the 2-position of the acyl moiety, but were barely hydrolyzed when the methyl group was substituted on the 3-position. These findings suggest that hCE-2 does not easily form acylated intermediates because of conformational interference in its active site. In contrast, hCE-1 could hydrolyze a variety of substrates. The hydrolytic activity of hCE-2 increased with increasing alcohol chain length in benzoic acid derivative substrates, whereas hCE-1 preferentially catalyzed the hydrolysis of substrates with short alcohol chains. Kinetic data showed that the determining factor for the rate of hydrolysis of p-aminobenzoic acid esters was V(max) for hCE-1 and K(m) for hCE-2. Furthermore, the addition of hydrophobic alcohols to the reaction mixture with p-aminobenzoic acid propyl ester induced high and low levels of transesterification by hCE-1 and hCE-2, respectively. When considering the substrate specificities of hCE-1, it is necessary to consider the transesterification ability of hCE-1, in addition to the binding structure of the substrate in the active site of the enzyme.