Resting cells of Rhodotorula rubra converted transferulic acid (1) to vanillic acid (2), then to guaiacol (3) and protocatechuic acid (4), under aerobic conditions. In an argon atmosphere, R. rubra transformed ferulic acid to vanillic acid and 4-hydroxy-3-methoxystyrene (5). Metabolites were isolated by solid-phase extraction and characterized by mass spectrometry, 1H, and 13C-nuclear magnetic resonance spectroscopy (NMR). The biotransformation of ferulic acid to vanillic acid by R. rubra cell-free extracts required CoA, ATP, and NAD+. Mass spectrometry and 13C-NMR were used to demonstrate the incorporation of oxygen from H2(18)O during the conversion of ferulic acid to vanillic acid. The results suggest a parallel between this bioconversion reaction and the beta-oxidation of fatty acids. Proton-carbon correlation NMR spectroscopy was used to demonstrate the specific incorporation of deuterium from D2O into guaiacol obtained from vanillic acid. The incorporation of deuterium implicates the involvement of a quinoid vanillic acid tautomer as an intermediate in the decarboxylation reaction.