1. The enzymes β-ketothiolase, acetoacetyl-CoA reductase, acetoacetate–succinate CoA-transferase (`thiophorase') and d(−)-3-hydroxybutyrate dehydrogenase have been partially purified from crude extracts of glucose-grown nitrogen-fixing batch cultures of Azotobacter beijerinckii. The condensation of acetyl-CoA to acetoacetyl-CoA catalysed by β-ketothiolase is inhibited by CoASH, and the reverse reaction is inhibited by acetoacetyl-CoA. Acetoacetyl-CoA reductase has Km for acetoacetyl-CoA of 1.8μm and is inhibited by acetoacetyl-CoA above 10μm. The enzyme utilizes either NADH or NADPH as electron donor. The second enzyme of poly-β-hydroxybutyrate degradation, d(−)-3-hydroxybutyrate dehydrogenase, is NAD+-specific and is inhibited by NADH, pyruvate and α-oxoglutarate. CoA transferase is inhibited by acetoacetate, the product of hydroxybutyrate oxidation. In continuous cultures poly-β-hydroxybutyrate biosynthesis ceased on relaxation of oxygen-limitation and the rates in situ of oxygen consumption and carbon dioxide evolution of such cultures increased without a concomitant increase in glucose uptake. 2. On the basis of these and other findings a cyclic mechanism for the biosynthesis and degradation of poly-β-hydroxybutyrate is proposed, together with a regulatory scheme suggesting that poly-β-hydroxybutyrate metabolism is controlled by the redox state of the cell and the availability of CoASH, pyruvate and α-oxoglutarate. β-Ketothiolase plays a key role in the regulatory process. Similarities to the pathways of poly-β-hydroxybutyrate biosynthesis and degradation in Hydrogenomonas are discussed.