A soluble, cytochrome P-450-dependent fatty acid hydroxylase-epoxidase isolated from Bacillus megaterium ATCC 14581 can be induced about 28-fold by the addition of phenobarbital (8 mM) to the growth medium. Phenobarbital is not a substrate for the enzyme nor does it activate the monooxygenase in the cell-free system. The level of the P-450-dependent monooxygenase activity in cultures harvested during the early stationary phase of growth increased linearly with phenobarbital concentration up to its solubility limit (8 mM) at 35 degrees C. The time course of induction during culture growth in the presence of 4 mM phenobarbital showed an interesting dichotomy. The specific content of cytochrome P-450 increased until the early stationary phase of growth and then leveled off. P-450-dependent monooxygenase activity, however, continued to increase rapidly to midstationary phase and then decreased just as rapidly after this time. At maximum specific activity, a turnover number of about 2,450 was obtained for palmitoleate hydroxylation-epoxidation by the cytochrome P-450 system.