Aloe arborescens is a medicinal plant rich in aromatic polyketides, such as pharmaceutically important aloenin (hexaketide), aloesin (heptaketide) and barbaloin (octaketide). Three novel type III polyketide synthases (PKS3, PKS4 and PKS5) were cloned and sequenced from the aloe plant by cDNA library screening. The enzymes share 85-96% amino acid sequence identity with the previously reported pentaketide chromone synthase and octaketide synthase. Recombinant PKS4 and PKS5 expressed in Escherichia coli were functionally identical to octaketide synthase, catalyzing the sequential condensations of eight molecules of malonyl-CoA to produce octaketides SEK4/SEK4b. As in the case of octaketide synthase, the enzymes are possibly involved in the biosynthesis of the octaketide barbaloin. On the other hand, PKS3 is a multifunctional enzyme that produces a heptaketide aloesone (i.e. the aglycone of aloesin) as a major product from seven molecules of malonyl-CoA. In addition, PKS3 also afforded a hexaketide pyrone (i.e. the precursor of aloenin), a heptaketide 6-(2-acetyl-3,5-dihydroxybenzyl)-4-hydroxy-2-pyrone, a novel heptaketide 6-(2-(2,4-dihydroxy-6-methylphenyl)-2-oxoethyl)-4-hydroxy-2-pyrone and octaketides SEK4/SEK4b. This is the first demonstration of the enzymatic formation of the precursors of the pharmaceutically important aloesin and aloenin by a wild-type PKS obtained from A. arborescens. Interestingly, the aloesone-forming activity was maximum at 50 degrees C, and the novel heptaketide pyrone was non-enzymatically converted to aloesone. In PKS3, the active-site residue 207, which is crucial for controlling the polyketide chain length depending on the steric bulk of the side chain, is uniquely substituted with Ala. Site-directed mutagenesis demonstrated that the A207G mutant dominantly produced the octaketides SEK4/SEK4b, whereas the A207M mutant yielded a pentaketide 5,7-dihydroxy-2-methylchromone.