Nemania aenea SF 10099-1, a basidiomycete isolated from a forest soil sample, regio- and stereoselectively epoxidized beta-caryophyllene (Car) to (-)-beta-caryophyllene oxide (Car-Ox) in a liquid-liquid interface bioreactor (L-L IBR) consisted of a liquid medium (a bottom phase), a fungus-ballooned microsphere (MS) mat (a middle phase), and an organic phase containing Car (a top phase). The cultivation conditions, such as carbon and nitrogen sources, kind of MS, initial medium pH and Car concentration, were optimized in the L-L IBR system. The best carbon and nitrogen sources were xylose and tryptone, respectively. The most suitable polyacrylonitrile MS was MMF-DE-1 (former MFL-80SDE; non-coated type). Although the strain could not grow below pH 5.5, the endocyclic epoxidation of Car efficiently proceeded at a wide range of initial medium pH (6.0 to 9.0). The bioconversion system exhibited an excellent alleviation effect toward substrate and product inhibitions. While Car could be added into an organic phase (KF-96L-1CS, dimethyl silicone oil) at 50% (w/v), the accumulation of Car-Ox reached over 30 g/l in spite of these strong microbial toxicities. Moreover, the epoxidation reaction smoothly proceeded in a novel L-L IBR system, a multistory L-L IBR systems, consisted of 5 stacked reactor units. The optical rotation of Car-Ox produced was (-) and the enantiomeric excesses of (-)-beta-Car-Ox purified by 1st and 2nd recrystallization from methanol reached 97.51 and 99.33%, respectively. (C) 2011, The Society for Biotechnology, Japan. All rights reserved.