Antibodies directed against cytochrome P-450Cm1 and the NADPH-cytochrome P-450 reductase were used to study the induction and intracellular localization of these components of the alkane monooxygenase system in the yeast Candida maltosa. Transition from glucose to n-hexadecane utilization resulted in an about 100-fold increase of the immunodetectable P-450 form whereas the reductase was only moderately induced by a factor of about 5. P-450 but not the reductase was further increased by oxygen limitation during cultivation on n-hexadecane. Using an immunogold technique on ultrathin cryosections, P-450 was found to be concentrated in the nuclear envelope during the early phase of the induction process. However, after maximal induction, the highest labeling was observed in membranes of the endoplasmic reticulum closely associated with the peroxisomes and the plasma membrane. Double-labeling experiments revealed that P-450 and its reductase were distributed in the same regions of the endoplasmic reticulum.