1. Enzyme systems responsible for formation of cyclopropane ring-cleavage metabolites (M1 and M2) of illudin S in rat liver were characterized. 2. The enzymes were localized in the cytosol fraction and utilized NADPH alone as electron donor; they were not affected by oxygen and had low pH optima. 3. Formation of metabolites M1 and M2 was inhibited completely by dicumarol (10(-4) M), an inhibitor of DT-diaphorase. 4. Menadione (10(-4) M) and quercetin (10(-4) M) both inhibited formation of M1 and M2 by 35% and 15%, respectively, but quinacrine, barbital, pyrazole and p-chloromercuribenzoic acid had no significant effect. 5. Results show that the enzyme systems may differ from DT-diaphorase, aldehyde oxidase, xanthine oxidase, ketone reductase, aldose reductase, aldehyde reductase and alcohol dehydrogenase, known cytosolic enzymes responsible for xenobiotic metabolism.