To investigate the biocatalytic potential of Colletotrichum acutatum and Colletotrichum nymphaeae for monoterpene biotransformation. C. acutatum and C. nymphaeae used limonene, alpha-pinene, beta-pinene, farnesene, citronellol, linalool, geraniol, perillyl alcohol, and carveol as sole carbon and energy sources. Both species biotransformed limonene and linalool, accumulating limonene-1,2-diol and linalool oxides, respectively. alpha-Pinene was only biotransformed by C. nymphaeae producing campholenic aldehyde, pinanone and verbenone. The biotransformation of limonene by C. nymphaeae yielded 3.34-4.01 g limonene-1,2-diol l(-1), depending on the substrate (R-(+)-limonene, S-(-)-limonene or citrus terpene (an agro-industrial by-product). This is among the highest concentrations already reported for this product. This is the first report on the biotransformation of these terpenes by Colletotrichum spp. and the biotransformation of limonene to limonene-1,2-diol possibly involves enzymes similar to those found in Grosmannia clavigera.