Recent in vivo studies indicate that ring monooxygenation is a widespread mechanism by which bacteria metabolize aromatic hydrocarbons and obtain carbon and energy. In this study, toluene 2-monooxygenase from Burkholderia (formerly Pseudomonas) cepacia G4 was purified to homogeneity and found to be a three-component enzyme system. The reconstituted enzyme system oxidized toluene to o-cresol and o-cresol to 3-methylcatechol, an important intermediate for growth of the bacterium on toluene. Steady-state kinetic parameters measured for the water-soluble substrate o-cresol were a Km of 0.8 µM and a Vmax of 131 nmol min-1 (mg of hydroxylase protein)-1. The three protein components were (1) a 40 kDa polypeptide containing one FAD and a [2Fe2S] cluster, (2) a 10.4 kDa polypeptide that contained no identifiable metals or organic cofactors, and (3) a 211 kDa α1β2γ3 component containing five to six iron atoms. The 40 kDa flavo-iron-sulfur protein oxidized NADH and transferred electrons to cytochrome c, dyes, and the α1β2γ3 component. It is analogous to other NADH oxidoreductase components found in a wide range of bacterial mono- and dioxygenases. The 10.4 kDa component, added to the other two components and NADH, increased toluene oxidation rates 10-fold. The α1β2γ3 component was indicated to contain the site for toluene binding and hydroxylation by the following observations: (1) tight binding to a toluene affinity column; (2) oxidation of toluene after reduction of the protein with dithionite and adding O2; (3) H202-dependent toluene oxidation and catalase activity; and (4) spectroscopic studies of the iron atoms in the component. The α1β2γ3 component had no significant absorbance in the visible region. EPR spectroscopy yielded a signal at g = 16 upon addition of <2 equiv of electrons per 2 Fe atoms. Taken with the quantitation of five to six iron atoms, the data suggest that the α1β2γ3 component contains two binuclear iron centers. In total, the structural, spectroscopic, and catalytic features of toluene 2-monooxygenase are reminiscent of soluble methane monooxygenase obtained from methanotrophic bacteria. The two enzyme systems also differ in many subtle ways; for example, they oxidize toluene with completely different regiospecificity.