When Methylocystis sp. M cells were immobilized in calcium alginate, the resulting cell beads showed optimum trichloroethylene (TCE) degradation activity at pH 7.0 and 35 degrees C. In comparison with free cells, the immobilized cells were more stable at low pH, and to some extent, at higher temperatures. Studies on the kinetics and the influence of cell density suggest that oxygen permeation was a rate-limiting step. Investigation of the storage stability and the optimum concentration of dissolved oxygen revealed that the TCE degradability was greater under anaerobic than aerobic conditions. Although a toxic effect caused by TCE was observed, methane seemed to restore activity, suggesting that the development of a two-step reactor system might be advantageous. The finding that the immobilized cells showed TCE degradation activity in actual groundwater suggests that TCE bioremediation could be achieved through the use of bioreactors with such cells.