A novel water soluble phosphine, N,N-dipolyoxyethylene-substituted-4-(diphenylphosphino) benzenesulfonamide (PEO-DPPSA), is synthesized by ethoxylation of 4-(diphenylphosphino) benzenesulfonamide Ph2P-C6H4SO2NH2 (DPPSA) obtained from palladium-catalyzed P-C coupling reaction between 4-I-C6H4SO2NH2 and Ph2PH. The PEO-DPPSA possesses the same property of inverse temperature-dependent solubility in water (cloud point, C-p) as nonionic surfactants. Investigation on the behavior of RhCl3. 3H(2)O/PEO-DPPSA complex in the aqueous-organic biphasic hydroformylation of 1-decene showed that the complex exhibited high catalytic activity. The conversion of 1-decene and the yield of aldehydes reach as high as 97.8 and 95.6%, respectively, under optimized conditions. The high reactivity of Rh/PEO-DPPSA complex can be attributed to a process termed thermoregulated phase transfer catalysis.