Biotechnological monoterpene oxidation has a considerable economic potential as an alternative route to natural monoterpenoid compounds with desirable organoleptic and pharmaceutical properties. Bacterial cytochrome P450 monooxygenases (CYPs) constitute ideal catalysts for monoterpene oxidation due to their pronounced selectivities, comparably high activities and ease of recombinant expression. Research activities of the recent decades resulted in the identification and characterization of many monoterpene oxidizing bacterial CYPs, often together with their electron transfer partners. To the authors' knowledge, no industrial process of bacterial monoterpene oxidation has been established up to date. However, the last decade has seen movement away from small scale test tube sized reactions to research activities focusing on more sophisticated processes in larger volumes and in bioreactors. These research activities successfully combined improvements on all levels of a biotransformation process. Activity, selectivity and stability of bacterial CYPs were enhanced by rational protein design, substrate and product toxicity was counteracted with the development of feeding strategies and in situ product removal techniques. The disadvantage of costly cofactors was bypassed by the application of cofactor regeneration systems and by electrochemical substitution of cofactors. (C) 2011 Elsevier Ltd. All rights reserved.