The gene encoding D-hydantoinase from Agrobacterium radiobacter NRRL B11291 was successfully cloned by use of polymerase chain reaction. A positive clone was scored, and its nucleotide sequence was further analyzed. The analysis by deleting various lengths of nucleotides from the amino terminus of the open reading frame revealed the putative regions for promoter and RBS site. By highly expressing both D-hydantoinase and carbamoylase, recombinant Escherichia coli strains were able to convert DL-hydroxyphenyl hydantoin (DL-HPH) to D-p-hydroxyphenylglycine (D-HPG) with a conversion yield of 97%, accounting for productivity 5 times higher than that obtained by A. radiobacter NRRL B11291. Immobilizing the recombinant cells with kappa-carrageenan could also achieve a conversion of 93%, while A. radiobacter NRRL B11291 attained 20% within the same period of reaction time. These results illustrate the feasibility in employing recombinant E, coli to accomplish one-step conversion of DL-HPH to D-HPG. In the process of improving D-HPG production, D-hydantoinase activity was increased 2.57-fold but carbamoylase activity remained constant, which resulted in only a 30% increase in the reaction rate. It suggests that carbamoylase is the step setting the pace of the reaction. Since the reaction substrate is highly insoluble, achieving sufficient agitation appears to be an important issue in this heterogeneous system. This view is further supported by the study on repeated use of cells, which shows that to reach a conversion of more than 90% free cells can be recycled six times, whereas immobilized cells can be used only twice. In conclusion, the poor reusability of immobilized cells is due to the fouling on the gel surface.