We describe the biocatalytic production of 3-phenylcatechol from 2-phenylphenol with the whole cell biocatalyst Escherichia coli JM101 (pHBP461). The recombinant produces 2-hydroxybiphenyl 3-monooxygenase, an enzyme from Pseudomonas azelaica HBP1. This enzyme introduces a hydroxyl-group at the C-3-position of a variety of 2-substituted phenols, such as 2-phenylphenol. This permits the biocatalytic production of 3-substituted catechols, which are difficult to synthesize chemically. Both 2-phenylphenol and 3-phenylcatechol are highly toxic to E. coli. The toxic effects of 2-phenylphenol were minimized by feeding this substrate to the reactor at a rate slightly below the maximum biooxidation rate. As a result, the substrate concentration in the reactor remained below toxic levels during the bioconversion. The toxic product formed was removed by continuous adsorption on the solid resin Amberlite(TM) XAD-4. To this end the reaction mixture, containing the biocatalyst, was pumped continuously through an external loop with a fluidized bed of the resin. This resin efficiently and quantitatively adsorbed both 3-phenylcatechol and the remaining trace amounts of 2-phenylphenol. Consequently, the concentrations of these compounds were kept at subtoxic levels (below 100 mg L-1) and gram amounts of 3-phenylcatechol were produced with space-time yields of up to 0.39 g L-1 h(-1). The product was recovered from the resin by acidic methanol elution and purified by recrystallization from n-hexane resulting in overall yields exceeding 59%. The optimized system served as a surprisingly simple and efficient integrated process, that allows the bioconversion of toxic substrates to toxic products with whole cell biocatalysts.