Resealed bovine chromaffin-granule 'ghosts' were used for assaying the membrane-bound form of dopamine beta-hydroxylase. Hydroxylation of the substrate tyramine is dependent on its accumulation within the 'ghosts', where the active site of the enzyme is located. Free tyramine in the medium is at a low concentration, low ionic strength and a relatively high pH (7.0), so that even in the presence of a reducing agent (co-reductant) the unaccumulated amine is hydroxylated at a negligible rate. 'Ghosts' contain an endogenous co-reductant, which is shown to be catecholamine remaining in the membrane itself after granule lysis. Catecholamine that is free in solution in the medium or in the interior of the 'ghosts' is not effective as co-reductant, nor is ascorbate, in contrast with the situation with soluble dopamine beta-hydroxylase. Ferrocyanide is an active co-reductant, however, giving a hydroxylation rate approximately equal to the tyramine accumulation rate: it does not enter the 'ghosts', nor does the enzyme appear to utilize ferrocyanide sealed inside the 'ghosts'. A mechanism must therefore exist for transferring electrons across the membrane from the cytoplasmic surface to the matrix surface. NADH is not an electron donor for the enzyme, nor is cytochrome b-561 involved.