Monoterpenes are important flavour and fragrance compounds. The biotransformation of monoter penes has been studied quite extensively during the past 30 years. Specific problems have been encountered during these studies which have prevented the commercialization of monoterpene biotransformation processes. The most important problems were the chemical instability of monoterpenes, the substrate and product toxicity and the presence of multiple transformation pathways in the microorganisms. Notwithstanding the encountered problems, the area of monoterpene biotransformation remains of great potential commercial interest to the food and perfume industry. The main advantages of the use of biotechnological methods for the production of flavours and fragrances are the fact that terpenoids produced in this way can be called natural and the fact that biocatalysts show, in general, a high regio- and stereoselectivity. Information regarding the enzyme systems involved in monoterpene biodegradation, except for the degradation of (+)- and (−)-camphor by Pseudomonas putida, is rather scarce. However, during the past decade new information has become available on the purification and description of several enzymes involved in other monoterpene degradation pathways. The genetic information encoding some of these enzymes has been cloned and sequenced. In the future, genetic engineering techniques may provide modified strains which can be used for the production of the desired product.