In a survey of 186 randomly selected microbial strains isolated from composted manure, 63 transformed oleic acid into three types of products: hydroxy fatty acid, fatty amide, and less polar oleyl lipid. Selection of oleic acid-transforming microorganisms was enhanced in nutrient agar supplemented with 0.1% (vol/vol) oleic acid at pH 7.2. Most of the 63 diverse isolates elicited inconsistent and poorly reproduced transformations. However, strains 142b (NRRL B-14797) transformed oleic acid to 10-hydroxystearic acid consistently, and strain 229b (NRRL B-14812) produced an octadecenamide. Taxonomic studies indicated that NRRL strain B-14797, possessing 1,3-dihydroxy-2-amino-15-methylhexadecane and sphinganine bases, was closely related to Sphingobacterium thalpophilum, and NRRL B-14812 was identified as Bacillus cereus.