A two-phase system is developed here for converting: (1) benzene to phenol and (2) naphthalene to 2-naphthol, using whole cells expressing wild-type toluene 4-mono-oxygenase (T4MO) and the alpha subunit variant TmoA 1100A from Pseudomonas mendocina KR1. Using the T4MO TmoA 1100A variant, the solubility of naphthalene was enhanced and the toxicity of the naphthols was prevented by the use of a water/dioctyl phthalate (80:20, vol%) system which yielded 21-fold more 2-naphthol. More than 99% 2-naphthol was extracted to the dioctyl phthalate phase, dihydroxynaphthalene formation was prevented, 92% 2-naphthol was formed, and 12% naphthalene was converted. Similarly, using 50 vol% dioctyl phthalate, an initial concentration of 3.0 g 1(-1) (39 mM), and wild-type T4MO, a 51 +/- 9% conversion of benzene was obtained and phenol was produced at a purity of 97%. Relative to the one-phase system, there was a 12-fold reduction in the formation of the byproduct catechol.