Deacetoxycephalosporin C synthase (expandase) from Streptomyces clavuligerus, encoded by cefE, is an important industrial enzyme for the production of 7-aminodeacetoxycephalosporanic acid from penicillin G. To improve the substrate specificity for penicillin G, eight cefE-homologous genes were directly evolved by using the DNA shuffling technique. After the first round of shuffling and screening, using an Escherichia coli ESS bioassay, four chimeras with higher activity were subjected to a second round. Subsequently, 20 clones were found with significantly enhanced activity. The kinetic parameters of two isolates that lack substrate inhibition showed 8.5-and 118-fold increases in the k cat /K m ratio compared to the S. clavuligerus expandase. The evolved enzyme with the 118-fold increase is the most active obtained to date anywhere. Our shuffling results also indicate the remarkable plasticity of the expandase, suggesting that more-active chimeras might be achievable with further rounds.Cephalosporins, which constitute one of the major -lactam antibiotic classes, are produced by several microorganisms, such as filamentous fungi, actinomycetes, and gram-negative bacteria. The biosynthesis of cephalosporins in Streptomyces clavuligerus and Acremonium chrysogenum has been studied extensively (19). In S. clavuligerus, deacetoxycephalosporin C synthase (DAOCS) (expandase), encoded by cefE, catalyzes the oxidative expansion of the five-membered thiazolidine ring of penicillin N into the six-membered dihydrothiazine ring of deacetoxycephalosporin C (DAOC) (13) (Fig. 1). DAOC is sequentially converted to deacetylcephalosporin C (DAC) by deacetylcephalosporin C synthase (DACS) (hydroxylase), encoded by cefF (12). Both expandase and hydroxylase are ␣-ketoglutarate and Fe(II) dependent oxygenases and share 55 to 60% amino acid identity. Interestingly, the enzyme from A. chrysogenum can catalyze the direct conversion of penicillin N to DAC due to possession of both expandase and hydroxylase activity; hence the encoded gene is termed cefEF (24).7-Aminodeacetoxycephalosporanic acid (7-ADCA) is one of the most important semisynthetic cephalosporins, and its current production includes the ring expansion of penicillin G into phenylacetyl-7-ADCA and the well-documented enzymatic removal of the phenylacetyl group. Due to potential pollution by the toxic chemicals used for the ring expansion, Penicillium chrysogenum and A. chrysogenum have been engineered metabolically to produce 7-ADCA derivatives (7, 27). However, the derivatives from these strains still need further complicated enzymatic processing. Therefore, the production of a penicillin G-specific expandase would be a more straightforward solution to the problems of 7-ADCA production.Several expandases have been screened from actinomycetes, and the S. clavuligerus enzyme has been well characterized. These enzymes have broad substrate specificity and can catalyze ring expansion in penicillins with various side chains. However, they prefer their physiological substrate, peni...