Luteibacter sp., a new bacterium isolated from the soil around a Taxus cuspidata Sieb. et Zucc plant, was studied for its capability to metabolize cephalomannine (1). After preparative fermentation, eight metabolites were obtained and characterized as baccatin III (2), baccatin V (3), 10-deacetylbaccatin III (4), 10-deacetyl-10-oxobaccatin V (5), 7-epicephalomannine (6), 10-deacetylcephalomannine (7), 10-deacetyl-7-epicephalomannine (8), and 3'-N-debenzoyl-3'-N-(2-methylbutyryl)-7-epitaxol (9). Among these metabolites, 9 is a new compound. Epimerization of the 7beta-OH group and hydrolysis of the C-13 side-chain were the two major reactions in this bioprocess. However, the biotransformation of 7beta-D-xylosyl-10-deacetyltaxol (10) with the same strain yielded a C-13 side-chain eliminated product without epimerization at C-7 (11). Metabolites 5-9 and 11, together with 1 and paclitaxel, were evaluated for their inhibitory activities against five human cancer cell lines (HCT-8, Bel-7402, BGC-823, A549, and A2780). All these compounds showed less potent activities than paclitaxel, which is currently used in clinical chemotherapy.