An NADPH-dependent carbonyl reductase (PsCR) gene from Pichia stipitis was cloned. It contains an open reading frame of 849 bp encoding 283 amino acids whose sequence had less than 60% identity to known reductases that produce ethyl (S)-4-chloro-3-hydroxybutanoates (S-CHBE). When expressed in Escherichia coli, the recombinant PsCR exhibited an activity of 27 U/mg using ethyl 4-chloro-3-oxobutanoate (COBE) as a substrate. Reduction of COBE to (S)-CHBE by transformants in an aqueous mono-phase system for 18 h, gave a molar yield of 94% and an optical purity of the (S)-isomer of more than 99% enantiomeric excess.