The reduction of 1,3-diketones and β-hydroxyketones with NaBH(4) in aqueous acetonitrile is highly stereoselective in the presence of stoichiometric amounts of bovine or human albumin, giving anti 1,3-diols with d.e. up to 96%. The same reaction, without albumin, gives syn and anti 1,3-diols in approximately 1:1 ratio. The presence of an aromatic carbonyl group is essential for diastereoselectivity in the NaBH(4)/albumin reduction of both 1,3-diketones and β-hydroxyketones. Thus, 3-hydroxy-1-(p-tolyl)-1-butanone is stereoselectively reduced in the presence of albumin, while reduction of its isomer 4-(p-tolyl)-4-hydroxy-2-butanone is not stereoselective. The albumin-controlled reduction is not stereospecific as both enantiomers of 1-aryl-3-hydroxy-1-butanones are reduced to diols with identical stereoselectivities. Circular dichroism of the bound substrates confirms that aromatic ketones are recognized by the protein's IIA binding site. Binding studies also suggest that 1,3-diketones are recognized in their enol form. From the effect of pH on binding of a diketone it is concluded that, in the complex with the substrate, ionizable residues His242 and Lys199 are in the neutral and protonated forms, respectively. A homology model of BSA was obtained and docking of model substrates confirms the preference of the protein for aromatic ketones. Modelling of the complexes with the substrates also allows us to propose a mechanism for the reduction of 1,3-diketones in which the chemoselective reduction of the first (aliphatic) carbonyl is followed by the diastereoselective reduction of the second (aromatic) carbonyl. The role of albumin is thus a combination of chemo- and stereocontrol.