Flavanones in Citrus are molecules that play an important role in antioxidant activities in nutraceutical products. Recent studies indicate that molecules of the simplest classes of phenolics have higher biological activity and absorption capacity. However, the molecules that have been shown to be very important bioactive compounds of Citrus, such as hesperetin, naringenin and ellagic acid, are found in trace concentrations in the fruit. An interesting environmentally friendly alternative that deserves attention regarding phenolic compound obtaining is the biotransformation of these molecules. The aim of this study was to develop a process of biotransformation of phenolics from Brazilian Citrus residues by solid-state fermentation with the microorganism Paecilomyces variotii. The optimized fermentation conditions were log of Citrus residues (2.0 mm of substrate particle size), 20 mL distilled water, at 32 degrees C after 48 h of incubation. The development of this process has generated, simultaneously, an increase of 900, 1400 and 1330% of hesperetin, naringenin and ellagic acid concentration, respectively, and an increase of 73% of the antioxidant capacity. These results give strong evidence that microbial biotransformation does not only produce phenolic compounds but also compounds with high biological activity, such as hesperetin and naringenin. (c) 2014 The Institution of Chemical Engineers. Published by Elsevier B.V. All rights reserved.