The partitioning behavior of phenylacetic acid (PAA) and 6-am nopenicillanic. acid (6-APA) in the nonionic surfactant N-decyltetra(ethylene oxide) (C10E4)-based aqueous two-phase system has been investigated. The two-phase system is formed by raising the solution temperature above the cloud-point temperature of C10E4 PAA shows a high affinity toward the surfactant-rich top phase. The partition coefficient of PAA is much greater than unity and strongly affected by pH. The partition coefficient decreases significantly from 82.3 to 3.8 when the pH is increased from 3.3 to 8.0 in the system with 1% (w/w) C10E4 at 30 degrees C. The partition coefficient of PAA also increases with temperature and the surfactant concentration. 6-APA, on the other hand, has a partition coefficient smaller than unity. It prefers to stay in the surfactant-lean bottom phase. A high degree of separation of PAA from 6-APA is achieved when penicillin-a hydrolysate is subjected to cloud-point extraction. The separation factor, defined as the ratio of the partition coefficient of PAA to that of 6-APA, is about 200 in the system with 2% (w/w) C10E4 at pH 8 and 30 degrees C. Simultaneous enzymatic reaction and extraction is also carried out to reduce the inhibition effect of PAA toward enzyme penicillin-G acylase. However, the enzymatic reaction rate is not enhanced in this two-phase system.