A large number of different chlorinated compounds arise in chlorine bleaching of pulp. We isolated a bacterium, Rhodococcus chlorophenolicus, which degrades 18 different polychlorinated phenolic compounds, most of which occur in spent bleaching liquor of kraft pulp. Degradation intermediates from polychlorinated phenols, guaiacols and syringols by R. chlorophenolicus were identified by gas chromatography-mass spectrometry. The initial attack was to add a hydroxyl substituent in the position 4. This occurred whether or not there was a chlorine substituent in this position. 4-chloro-phenols, -guaiacols and -syringols were thus both dechlorinated and hydroxylated. The novel hydroxyl was derived from water. The chlorohydroquinones produced in para-hydroxylation were further degraded through hydrolytic and reductive dechlorination. O-methylation of chlorohydroquinones competed with this dechlorination. The methylation reaction was constitutively expressed in contrast to the 4-hydroxylation, which was induced by the substrate. The para-methoxyphenols, -guaiacols and -syringols accumulated and were only slowly removed from the culture.