The substrate specificity of the flavoprotein vanillyl-alcohol oxidase from Penicillium simplicissimum was investigated. Vanillyl-alcohol oxidase catalyzes besides the oxidation of 4-hydroxybenzyl alcohols, the oxidative deamination of 4-hydroxybenzylamines and the oxidative demethylation of 4-(methoxymethyl)phenols. During the conversion of vanillylamine to vanillin, a transient intermediate, most probably vanillylimine, is observed. Vanillyl-alcohol oxidase weakly interacts with 4-hydroxyphenylglycols and a series of catecholamines. These compounds are converted to the corresponding ketones. Both enantiomers of (nor)epinephrine are substrates for vanillyl-alcohol oxidase, but the R isomer is preferred. Vanillyl-alcohol oxidase is most active with chavicol and eugenol. These 4-allylphenols are converted to coumaryl alcohol and coniferyl alcohol, respectively. Isotopic labeling experiments show that the oxygen atom inserted at the C gamma atom of the side chain is derived from water. The 4-hydroxycinnamyl alcohol products and the substrate analog isoeugenol are competitive inhibitors of vanillyl alcohol oxidation. The binding of isoeugenol to the oxidized enzyme perturbs the optical spectrum of protein-bound FAD. pH-dependent binding studies suggest that vanillyl-alcohol oxidase preferentially binds the phenolate form of isoeugenol (pKa < 6, 25 degrees C). From this and the high pH optimum for turnover, a hydride transfer mechanism involving a p-quinone methide intermediate is proposed for the vanillyl-alcohol-oxidase-catalyzed conversion of 4-allylphenols.