Biocatalysis involves the use of enzymes to perform stereo- and enatio-specific reactions producing valuable products in an environmentally benign way. However, the hydrophobic nature of most of the substrates affects the productivity due to poor solubility in aqueous solutions and high toxicity to cells expressing the biocatalyst. These drawbacks can be eliminated by using biphasic media, where a second phase of organic solvent serves as a reservoir of substrate and helps in extracting the products in-situ. Oxidation of napthalane to produce either 1-naphthol or 1,2-naphthalene dihydrodiol was studied using biocatalysis in biphasic media. This is an abstract of a paper presented at the AIChE Spring National Meeting (New Orleans, LA 4/6-10/2008).