The aklavinone 11-hydroxylase which was overexpressed using T7 promoter in E. coli could be detected in SDS-PAGE only in insoluble precipitate without any detectable enzyme activity. The insoluble enzyme was solubilized in 6M guanidine$.$HCl solution and their refolding ability was tested under various conditions. When the enzymatic activity was checked by the bioconversion experiment, stepwise dialysis against 6M, 3M, 1M guanidine$.$HCl and finally 100 mM potassium phosphate buffer of the solubilized protein gave the best bioconversion efficiency. The aklavinone 11-hydroxylase showed its enzymatic activity in the reaction buffer containing NADPH with vigorous shaking. The enzymatic activity was lost during partial purification and regained by the addition of crude extract of S. lividans in the reaction mixture. This effect was confirmed to due to some low-molecular weight component(s) in the crude extract, because the addition of dialyzed crude extract could not recover the enzymatic activity.