Cytochrome P450 monooxygenases of the CYP102A subfamily are single-component natural fusion proteins consisting of a heme domain and a diflavin reductase. The characterised CYP102A enzymes are fatty acid hydroxylases with turnover rates of several thousands per minute. In search of new P450s with similar activities, but with a broader substrate spectrum, we cloned, expressed and characterised CYP102A7 from Bacillus licheniformis. As expected, CYP102A7 was active towards medium-chain fatty acids but showed a strong preference for saturated over unsaturated fatty acids, which could not be observed for either of the CYP102A members so far. Besides fatty acids, CYP102A7 was able to catalyse the oxidation of cyclic and acyclic terpenes with high activity and coupling efficiency. For example, (R)-(+)-limonene was converted with activity of 220 nmol nmol P450(-1) min(-1) and 80% coupling. Unusual for enzymes of the CYP102A subfamily was the deethylation activity of CYP102A7 towards 7-ethoxycoumarin. Furthermore, this monooxygenase, though having a moderate thermal stability, exhibited 50% of its initial activity in the presence of 26% DMSO. Comparison of the homology models of CYP102A7 and other members of the CYP102A subfamily revealed distinct differences in the shape of the substrate access channel and the active site, which might explain differences in catalytic properties of these homologous enzymes.