Sinorhizobium fredii USDA191 is a Gram-negative bacterium capable of forming nitrogen-fixing nodules on soybean roots. The USDA191 idhA gene encoding myo-inositol dehydrogenase, an enzyme necessary for myo-inositol utilization, is known to be involved in competitive nodulation and nitrogen fixation. In Bacillus subtilis, myo-inositol dehydrogenase catalyzes the first step of the myo-inositol catabolic pathway. Recently iolE was identified as the gene encoding 2-keto-myo-inositol dehydratase, which catalyzes the second step in the pathway. Here we report the presence of 2-keto-myo-inositol dehydratase activity in free-living USDA191 cells cultured in a medium containing myo-inositol. An iolE ortholog was cloned from USDA191. USDA191 iolE was expressed in Escherichia coli as a His(6)-tag fusion and purified to exhibit 2-keto-myo-inositol dehydratase activity. Inactivation of USDA191 iolE led to defective myo-inositol utilization. USDA191 iolE partially complemented a B. subtilis iolE deficient mutant. These results suggest that S. fredii USDA191 utilizes a myo-inositol catabolic pathway, analogous to that of B. subtilis, involving at least idhA and iolE.