Semi-synthetic derivatives of the anti-malarial drug artemisinin hold great promise in the search for an effective and economical treatment of chloroquine-resistant forms of malaria. Unfortunately, synthetic functionalization of the artemisinin skeleton is often tedious and/or impractical. We seek to utilize 7beta-hydroxyartemisinin, obtained from microbial transformation, as a semi-synthetic precursor for the synthesis of novel 7beta-substituted artemisinin anti-malarial agents. Here we employ liquid cultures of Cunninghamella elegans as a means for the rational and economical bioconversion of artemisinin to 7beta-hydroxyartemisinin in 78.6% yield. In addition, there were three other bioconversion products: 7beta-hydroxy-9alpha-artemisinin (6.0%), 4alpha-hydroxy-1-deoxoartemisinin (5.4%), and 6beta-hydroxyartemisinin (6.5%).