One of the major problems in whole-cell biocatalysis is its low reaction rate. The underlying cause is the substrate permeation barrier presented by cell envelopes. The present research investigates mutation effects of the Braun's lipoprotein, the most abundant outer membrane structural protein in Escherichia coli, on toluene dioxyengase (TDO)-catalyzed reaction. Dramatic enhancement of the reaction rate, an increase of up to 6-fold, was observed with the mutant for all three small, hydrophobic substrates tested (toluene, ethylbenzene, and 2-indanone). The increase was observed over a wide range of substrate concentrations (0.1-5 mM). The mutant exhibited a normal growth rate and expressed the recombinant multicomponent enzyme as well as the isogenic parent strain. Taken together, the lipoprotein mutant expressing TDO is a much better whole-cell catalyst for the oxidation reaction. The beneficial effect of the lipoprotein mutation may be general for a broad range of substrates and enzyme systems as the mutation affects the global integrity of the cell membrane. A comparison of the mutation effect with a common permeabilizing procedure, the EDTA treatment, further illustrates the clear advantages of using genetic modification in cellular membrane engineering for improved whole-cell catalysts.