The discovery of penicillin was announced over 60 years ago. It was the first beta-lactam antibiotic and the importance of this group is greater today than it has ever been. It is clear that even at 60 years of age, beta-lactams are going strong and no one contemplates their early retirement. Currently, sales of beta-lactam compounds form the largest share by far of the world's antibiotic market. The beta-lactam antibiotics include penicillins such as penicillin G, penicillin V, ampicillin, cloxacillin, and piperacillin; cephalosporins such as cephalothin, cephaloridine, cephalexin, and cefaclor; and cephamycins such as cefoxitin. In addition, beta-lactam antibiotics include the more recently developed nonclassical structures such as monobactams, including aztreonam; clavulanic acid, which is a component of the combination drug augmentin; and thienamycin, which is chemically transformed into imipenem, a component of the combination drug known as primaxin (or tienam). The classical beta-lactam antibiotics can be divided into hydrophobic and hydrophilic fermentation products. The hydrophobic members, e.g. benzylpenicillin (penicillin G) and phenoxymethylpenicillin (penicillin V), contain non-polar side chains, e.g. phenylacetate and phenoxyacetate, respectively, and are made only by filamentous fungi; the best known of these is Penicillium chrysogenum. The antibacterial spectrum of the hydrophobic penicillins is essentially Gram-positive. The hydrophilic types are penicillin N, cephalosporins and 7-alpha-methoxycephalosporins (cephamycins) which are made by fungi, actinomycetes and unicellular bacteria. They all contain the polar side chain, D-alpha-aminoadipate. We can draw a sequence of reactions which describes the biosynthesis of all penicillins and cephalosporins, however the total sequence exists in no one microorganism. All penicillin and cephalosporin biosynthetic pathways possess the first three steps in common and all cephalosporin pathways go through deacetylcephalosporin C. However, there are many subsequent biosynthetic reactions which vary in the different producing organisms. Production of beta-lactam antibiotics occurs best under conditions of nutrient imbalance and at low growth rates. Nutrient imbalance can be brought about by limitation of the carbon, nitrogen or phosphorus source. In addition to these factors, amino acids such as lysine and methionine exert marked effects on production of penicillins and/or cephalosporins by some microorganisms. Induction of some of the synthetases, especially the first enzyme, ACV synthetase, by methionine is the basis of the methionine stimulation of cephalosporin C synthesis in C. acremonium. Inhibition of homocitrate synthase is the mechanism involved in lysine inhibition of penicillin synthesis in Penicillium chrysogenum.(ABSTRACT TRUNCATED AT 400 WORDS)