Selective oxy-functionalization of nonactivated C-H bonds is a long-standing "dream reaction" of organic synthesis for which chemical methodology is not well developed. Mono-oxygenase enzymes are promising catalysts for such oxy-functionalization to establish. Limitation on their applicability arises from low reaction output. Here, we showed an integrated approach of process engineering to the intensification of the cytochrome P450 BM3-catalyzed hydroxylation of dodecanoic acid (C12:0). Using P450 BM3 together with glucose dehydrogenase for regeneration of nicotinamide adenine dinucleotide phosphate (NADPH), we compared soluble and co-immobilized enzymes in O-2-gassed and pH-controlled conversions at high final substrate concentrations (>= 40mM). We identified the main engineering parameters of process output (i.e., O-2 supply; mixing correlated with immobilized enzyme stability; foam control correlated with product isolation; substrate solubilization) and succeeded in disentangling their complex interrelationship for systematic process optimization. Running the reaction at O-2-limited conditions at up to 500-ml scale (10% dimethyl sulfoxide; silicone antifoam), we developed a substrate feeding strategy based on O-2 feedback control. Thus, we achieved high reaction rates of 1.86g center dot L-1 center dot hr(-1) and near complete conversion (>= 90%) of 80mM (16g/L) C12:0 with good selectivity (<= 5% overoxidation). We showed that "uncoupled reaction" of the P450 BM3 (similar to 95% utilization of NADPH and O-2 not leading to hydroxylation) with the C12:0 hydroxylated product limited the process efficiency at high product concentration. Hydroxylated product (similar to 7g; >= 92% purity) was recovered from 500ml reaction in 82% yield using ethyl-acetate extraction. Collectively, these results demonstrate key engineering parameters for the biocatalytic oxy-functionalization and show their integration into a coherent strategy for process intensification.