The biosynthesis of cephalosporins is catalyzed by deacetoxycephalosporin C synthase (DAOCS). Based on computational, biochemical, and structural analyses, it has been proposed that modification of the C-terminus of DAOCS might be a constructive strategy for engineering improvement in enzyme activity. Therefore, five hydrophilic residues namely N301, Y302, N304, 8306, and 8307 located in proximity to the C-terminus of Streptomyces clavuligerus DAOCS (scDAOCS) were selected and each substituted with a hydrophobic leucine residue. Substitutions at positions 304, 306, and 307 created mutant scDAOCSs with improved efficiencies in penicillin analog conversion up to 397%. And since it has been previously advocated that the C-terminus is crucial for guiding substrate entry, a truncated mutant DAOCS was constructed to assess its involvement. The truncation of the C-terminus at position 310 in the wild-type scDAOCS resulted in reduction of indiscriminate conversion of penicillin analog but this defect was compensated by the replacement of asparagine with leucine at position 304. (C) 2002 Elsevier Science (USA). All rights reserved.