Over the recent years, increasing scientific attention has been paid to pharmaceuticals, other drugs and their metabolites. These substances are of particular interest because of their physiological, toxicological and ecotoxicological effects in the human body andrnrespectively in the environment. Cytochrome P450 enzymes (P450s) play a key role in thernconversion and detoxification of bioactive compounds including many pharmaceuticalsrnand drugs. Most of these enzymes belong to the monooxygenases; they are intracellularrnand rather unstable biocatalysts that are difficult to purify and require expensive, complex cofactors, which alltogether hampers their use in isolated form. The investigations carried out here with fungal peroxygenases have shown that this peroxidase subclass (EC 1.11.2.x) has a promising potential for oxyfunctionalizations and can catalyze a variety of reactions typical for P450s. Peroxygenases are extracellular, i.e. secreted fungal enzymes with high stability, which merely need peroxide for function. Results obtained with the unspecific/aromatic peroxygenases (APOs) of Agrocybe aegerita, Coprinellus radians and Marasmius rotula have demonstrated that APOs catalyze numerous H2O2-dependent monooxygenations of pharmaceuticals and psychoactive drugs. Among them are i) the monooxygenation of aromatic compounds, ii) the benzylic hydroxylation of toluene derivatives, iii) the O-dealkylation of different ether structures including the scission of benzodioxoles (O-demethylenation) and esters as well as iv) the N-dealkylation ofrnsecondary and tertiary amines. The peroxygenases studied considerably differ in their substrate spectrum and the preferred positions of oxidation. This finding opens thernpossibility to develop in the future an “enzymatic toolbox“ on the basis of fungalrnperoxygenases for the oxyfunctionalization of pharmaceutically relevant compounds.rnMechanistic studies showed that (1) the monooxygenations always proceed via incorporation of one oxygen atom from the peroxide, (2) the demethylation of phenacetind1rnestablished a deuterium isotope effect similar to P450s, (3) the catalytic efficiencies forrnthe studied oxidations are in the same range as those of P450s (though the kcat- and Km values are noticeably higher), (4) the kinetic studies with nitro-1,3-benzodioxole gavernparallel double reciprocal plots suggestive of a “ping pong” mechanism, (5) the substraternspectrum and the activity pattern of APOs follows in a wide range those of the human keyrnP450s as well as that (6) the difference spectra obtained in bindings studies are of thernphenol type of P450s. Furthermore, APOs were found to be stable and active in long termrnexperiments over two weeks and they oxidized pharmaceuticals at low, environmentallyrnrelevant concentration (ppb range). All the above properties strongly indicate that APOsrnrespresent an interesting alternative for the enzymatic conversion of pharmaceuticals asrnwell as for the preparation of human drug metabolites, for example, in medicinal andrnpharmacological research or the bioremediation sector (removal of pharmaceuticals fromrnenvironmental media).