Escherichia coli JM101(pSPZ3), containing xylene monooxygenase (XMO) from Pseudomonas putida mt-2, catalyzes specific oxidations and reductions of m-nitrotoluene and derivatives thereof. In addition to reactions catalyzed by XMO, we focused on biotransformations by native enzymes of the E. coli host and their effect on overall biocatalyst performance. While m-nitrotoluene was consecutively oxygenated to m-nitrobenzyl alcohol, m-nitrobenzaldehyde, and m-nitrobenzoic acid by XMO, the oxidation was counteracted by an alcohol dehydrogenase(s) from the E. coli host, which reduced m-nitrobenzaldehyde to m-nitrobenzyl alcohol. Furthermore, the enzymatic background of the host reduced the nitro groups of the reactants resulting in the formation of aromatic amines, which were shown to effectively inhibit XMO in a reversible fashion. Host-intrinsic oxidoreductases and their reaction products had a major effect on the activity of XMO during biocatalysis of m-nitrotoluene. P. putida DOT-T1E and P. putida PpS81 were compared to E. coli JM101 as alternative hosts for XMO. These promising strains contained an additional dehydrogenase that oxidized m-nitrobenzaldehyde to the corresponding acid but catalyzed the formation of XMO-inhibiting aromatic amines at a significantly lower level than E. coli JM101.Microbial enzymes are useful catalysts for the degradation of organic pollutants in bioremediation but also for the synthesis of added-value products in biocatalytic applications. Various large-scale processes based on bacterial enzymes have been established (17,26,30,47), which illustrate the increasing impact of biocatalysis in the chemical industry (45). Heterologous gene expression has developed to a standard technology for increasing and controlling enzyme activities in bioprocesses. It allows catalysis of a variety of reactions in a limited number of bacterial strains used as recombinant hosts. The focus on a few suitable hosts is emphasized, e.g., by the PlugBug concept (DSM, Heerlen, The Netherlands). Of these strains, Escherichia coli strains are easily accessible for genetic and biochemical engineering and provide high metabolic activity for cofactor regeneration. Their use as recombinant hosts is especially favorable in cofactor-dependent oxygenase-based processes (7) for the conversion of various aromatic hydrocarbons to industrially relevant products (5, 38, 54). E. coli JM101(pSPZ3) (39) contains xylene monooxygenase (XMO) from Pseudomonas putida mt-2 and oxidizes the methyl groups of a variety of toluene and xylene derivatives to the corresponding alcohols, aldehydes, and acids (8,12,55).Nitroaromatics are widely used in large amounts as synthetic intermediates, dyes, pesticides, pharmaceuticals, and explosives (21, 46). Their electrophilic character makes them susceptible to reduction by all kinds of microbial systems (41). Numerous bacterial strains, such as those of Pseudomonas species (1, 43) and E. coli (13), provide enzymes that are able to transform nitro groups of aromatic compounds under aerobic condition...