Fusarium moniliforme strain MS31 can oxidize propylbenzene to (R)-1-phenylpropanol with what may be a cytochrome P450. Hydroxylation of propylbenzene needed molecular oxygen, and NADPH as a coenzyme gave a higher yield than NADH. The hydroxylation proceeded further when FAD and FMN were added than in their absence, suggesting that the enzyme was a flavoprotein. Carbon monoxide inhibited the hydroxylation, as did other cytochrome P450 inhibitors such as SKF 525A and miconazole. These characteristics matched those of a microsomal cytochrome P450 monooxygenase system that contained NADPH-cytochrome P450 reductase.