Recent in vivo studies indicate that ring monooxygenation is a widespread mechanism by which bacteria metabolize aromatic hydrocarbons and obtain carbon and energy. In this study, toluene 2-monooxygenase from Burkholderia (formerly Pseudomonas) cepacia G4 was purified to homogeneity and found to be a three-component enzyme system. The reconstituted enzyme system oxidized toluene to o-cresol and o-cresol to 3-methylcatechol, an important intermediate for growth of the bacterium on toluene. Steady-state kinetic parameters measured for the water-soluble substrate o-cresol were a Km of 0.8 microM and a Vmax of 131 nmol min-1 (mg of hydroxylase protein)-1. The three protein components were (1) a 40 kDa polypeptide containing one FAD and a [2Fe2S] cluster, (2) a 10.4 kDa polypeptide that contained no identifiable metals or organic cofactors, and (3) a 211 kDa alpha 2 beta 2 gamma 2 component containing five to six iron atoms. The 40 kDa flavo-iron-sulfur protein oxidized NADH and transferred electrons to cytochrome c, dyes, and the alpha 2 beta 2 gamma 2 component. It is analogous to other NADH oxidoreductase components found in a wide range of bacterial mono- and dioxygenases. The 10.4 kDa component, added to the other two components and NADH, increased toluene oxidation rates 10-fold. The alpha 2 beta 2 gamma 2 component was indicated to contain the site for toluene binding and hydroxylation by the following observations: (1) tight binding to a toluene affinity column; (2) oxidation of toluene after reduction of the protein with dithionite and adding O2; (3) H2O2-dependent toluene oxidation and catalase activity; and (4) spectroscopic studies of the iron atoms in the component. The alpha 2 beta 2 gamma 2 component had no significant absorbance in the visible region. EPR spectroscopy yielded a signal at g = 16 upon addition of > 2 equiv of electrons per 2 Fe atoms. Taken with the quantitation of five to six iron atoms, the data suggest that the alpha 2 beta 2 gamma 2 component contains two binuclear iron centers. In total, the structural, spectroscopic, and catalytic features of toluene 2-monooxygenase are reminiscent of soluble methane monooxygenase obtained from methanotrophic bacteria. The two enzyme systems also differ in many subtle ways; for example, they oxidize toluene with completely different regiospecificity.