Retinoic acid is considered to be the active metabolite of retinol, able to control differentiation and proliferation of epithelia. Retinoic acid biosynthesis has been widely described with the implication of multiple enzymatic activities. However, our understanding of the cell biological function and regulation of this process is limited. In a recent study we evidenced that milk xanthine oxidase (E.C. 220.127.116.11.) is capable to oxidize all-trans-retinol bound to CRBP (holo-CRBP) to all-trans-retinaldehyde and then to all-trans-retinoic acid. To get further knowledge regarding this process we have evaluated the biosynthetic pathway of retinoic acid in a human mammary epithelial cell line (HMEC) in which xanthine dehydrogenase (E.C. 18.104.22.168.), the native form of xanthine oxidase, is expressed. Here we report the demonstration of a novel retinol oxidation pathway that in the HMEC cytoplasm directly conduces to retinoic acid. After isolation and immunoassay of the cytosolic protein showing retinol oxidizing activity we identified it with the well-known enzyme xanthine dehydrogenase. The NAD+ dependent retinol oxidation catalyzed by xanthine dehydrogenase is strictly dependent on cellular retinol binding proteins and is inhibited by oxypurinol. In this work, a new insight into the biological role of xanthine dehydrogenase is given.