The metabolism of phenanthrene by a gram-negative organism able to use this compound as a sole source of carbon and energy has been examined. 1-Hydroxy-2-naphthoic acid was oxidized by oxygen in a reaction catalyzed by a dioxygenase which was activated by ferrous ions. The stoichiometry of the oxidation and the UV spectrum of the product were consistent with the identification of the product as 2'-carboxybenzalpyruvate. This was confirmed by cleaving the product with a partially purified aldolase to yield 2-carboxybenzaldehyde and pyruvate. A number of enzymes for the metabolism of 1-hydroxy-2-naphthoic acid were induced by growth on phthalate or (less well) by growth on protocatechuate. The latter supported only a slow rate of growth, and this and poor induction may have been due to a slow rate of entry into the cell.