Abstract The hydroxylation of γ-butyrobetaine (4-trimethylaminobutyrate) to carnitine (3-hydroxy-4-trimethylaminobutyrate) is catalyzed by a soluble enzyme from rat liver which has been partially purified. The enzyme which previously has been shown to require molecular oxygen and ferrous ion has a specific requirement for 2-ketoglutarate. Several reductants stimulate the formation of hydroxylated product; the most active ones are ascorbate and isoascorbate, whereas reduced 2,6-dichlorophenolindophenol and 2-amino-5,6-dimethyl-4-hydroxy-5,6,7,8-tetrahydropteridine are less active. The previously observed stimulation both by NADPH, isocitrate, isocitrate dehydrogenase (EC 1.1.1.42), and by microsomes has been found to be related to the formation of 2-ketoglutarate. One mole of 2-ketoglutarate is degraded per mole of carnitine formed. Carbon dioxide and succinate are products of 2-ketoglutarate degradation; no free succinic semialdehyde can be detected. Several compounds which are chemically or biologically related to γ-butyrobetaine and to 2-ketoglutarate have been tested as inhibitors in the reaction. Only succinic semialdehyde and 3-trimethylaminopropyl-1-sulfonate are effective inhibitors. The sulfhydryl reagents p-chloromercuribenzoate and p-chloromercuriphenylsulfonate in 0.1 mm concentration completely inhibit the formation of carnitine after preliminary incubation with the enzyme for 20 min at 37°. N-Ethylmaleimide, iodosobenzoate, and iodoacetate are less effective inhibitors under these conditions, whereas sodium arsenite, carbarsone, and acetarsone cause appreciable inhibition only in 10 mm concentration. Preliminary incubation of the enzyme with ferrous ion and ascorbate results in significantly lower yield of carnitine than when catalase has also been included in the preliminary incubation medium. It is suggested that γ-butyrobetaine is hydroxylated to carnitine simultaneously with the oxidative decarboxylation of 2-ketoglutarate in a reaction sequence which involves the intermediate formation of a peroxide of the two substrates. Ferrous ion might act as oxygen-activating agent. Free sulfhydryl groups are apparently necessary for enzymic activity and ascorbate and catalase probably act by maintaining these groups as well as ferrous ion in the reduced state.