Daunorubicin (daunomycin; NSC 82151) is a fermentation-derived anthracycline antibiotic that is clinically useful in the treatment of human leukemias. Daunorubicin itself is found rarely in microbial fermentations, but is present normally in the form of glycoside derivatives that yield the free drug on simple acid hydrolysis. A major by-product of daunorubicin fermentations is usually the structurally related anthracyclinone epsilon-rhodomycinone. We have used mutants of a daunorubicin-producing Streptomyces species to study the biosynthetic relationship between epsilon-rhodomycinone and daunorubicin. We found that exogenously added epsilon-rhodomycinone can be converted to daunorubicin glycosides by a nonproducing mutant and by a mutant that produces daunorubicin glycosides but not epsilon-rhoeomycinone. Molar conversion efficiences were in the 15 to 30% range. The latter mutant was also shown to convert exogenous 14C-labeled epsilon-rhodomycinone to 14C-labeled daunorubicin glycosides, again at conversion efficiencies of about 25%. The same biotransformation was observed with daunorubicin production strain C5, which normally accumulates both epsilon-rhodomycinone and daunorubicin glycosides. A significant percentage (16 to 37%) of exogenously added epsilon-[14C]rhodomycinone was metabolized by strain C5, and 22 to 32% of the metabolized radioactivity could be recovered as daunorubicin glycosides. A mathematical model of epsilon-rhodomycinone metabolism was constructed based on plausible assumptions concerning the kinetics of epsilon-rhodomycinone accumulation and catabolsim. When analyzed according to this model, our data indicate that most (63 to 73%), but not all, of the daunorubicin glycosides accumulated in the experiments with production strain C5 derived from epsilon-rhodomycinone. A pathway network for the biosynthesis of daunorubicin glycosides is proposed that is in agreement with these data. In this proposed pathway network, epsilon-rhodomycinone is an intermediate in one of at least two pathways which yield daunorubicin glycosides.