Out of the eight enzymes involved in the biosynthesis of the isoquinoline alkaloid berberine, at least, two enzymes, berberine bridge enzyme and (S)-tetrahydroprotoberberine oxidase, are exclusively located in a vesicle with a specific gravity of ϱ=1.14 g·cm(-3) as shown by direct enzymatic assay as well as immunoelectrophoresis. Electronmicroscopic examination of the enzyme-containing particulate preparation from Berberis wilsoniae var. subcaulialata cultured cells demonstrated that it is composed mainly of membranous vesicles. The protein composition of this preparation reveals the presence of only about 20 separable proteins, of which two major ones are berberine bridge enzyme and (S)-tetrahydroprotoberberine oxidase. Incubation of these vesicles with the substrate (S)-reticuline in the presence and absence of S-adenosyl-L-methionine leads to the formation of a red product which was identified as dehydroscoulerine. If the cytoplasmic enzyme S-adenosyl-L-methionine:(S)-scoulerine-9-O-methyltransferase is added to the vesicle preparation in the presence of (S)-reticuline and S-adenosyl-L-methionine, not dehydroscoulerine but columbamine, the immediate precursor of berberine is formed. Some of the quaternary alkaloids are located inside the vesicles; fusion of these vesicles leads to vacuoles containing the quaternary alkaloids. These vesicles are the first highly specific and unique compartment serving only alkaloid biosynthesis; they are found in members of four different plant families and in cell cultures as well as in differentiated tissue.