Microbial phytosterol degradation is accompanied by the formation of steroid pathway intermediates, which are potential precursors in the synthesis of bioactive steroids. Degradation of these steroid intermediates is initiated by ⌬ 1 -dehydrogenation of the steroid ring structure. Characterization of a 2.9-kb DNA fragment of Rhodococcus erythropolis SQ1 revealed an open reading frame (kstD) showing similarity with known 3-ketosteroid ⌬ 1 -dehydrogenase genes. Heterologous expression of kstD yielded 3-ketosteroid ⌬ 1 -dehydrogenase (KSTD) activity under the control of the lac promoter in Escherichia coli. Targeted disruption of the kstD gene in R. erythropolis SQ1 was achieved, resulting in loss of more than 99% of the KSTD activity. However, growth on the steroid substrate 4-androstene-3,17-dione or 9␣-hydroxy-4-androstene-3,17-dione was not abolished by the kstD gene disruption. Bioconversion of phytosterols was also not blocked at the level of ⌬ 1 -dehydrogenation in the kstD mutant strain, since no accumulation of steroid pathway intermediates was observed. Thus, inactivation of kstD is not sufficient for inactivation of the ⌬ 1 -dehydrogenase activity. Native polyacrylamide gel electrophoresis of cell extracts stained for KSTD activity showed that R. erythropolis SQ1 in fact harbors two activity bands, one of which is absent in the kstD mutant strain.Rhodococcus species are well known for their catabolic potential (5, 40). Several Rhodococcus species degrade natural phytosterols. Microbial phytosterol degradation proceeds via the formation of steroids as pathway intermediates (16,21,22), i.e., 4-androstene-3,17-dione, 1,4-androstadiene-3,17-dione, and 9␣-hydroxy-4-androstene-3,17-dione (Fig.