To overcome the chemically laborious stereo- and regioselective hydroxylation steps in the pharmaceutical production of corticosteroids and progestogens, certain fungal species, e.g. Rhizopus spp. and Aspergillus spp., are employed to perform the 11α-hydroxylation of the steroid skeleton, thereby significantly simplifying steroid drug production. Here we report for the first time the identification and expression of a fungal 11α-steroid hydroxylase, CYP509C12. The newly identified cytochrome P450, which is one of the 48 putative CYP genes in Rhizopus oryzae, was induced in the fungus by progesterone. By functionally expressing CYP509C12 in recombinant fission yeast, we were able to determine that its substrate spectrum includes progesterone as well as testosterone, 11-deoxycorticosterone, and 11-deoxycortisol, with the hydroxylations taking place predominantly at 11α and 6β positions of the steroid ring system. To increase the 11α-hydroxylation activity of CYP509C12 in recombinant fission yeast, its natural redox partner, the R. oryzae NAD(P)H-dependent reductase, was coexpressed. The coexpression improved electron transfer to CYP509C12 and thus an increase in productivity from 246 to 300 μM hydroxyPg d(-1) was observed, as well as a 7-fold increase of rate of hydroxyprogesterone formation within the linear phase of transformation. This newly developed strain displayed total bioconversion of progesterone into 11α-hydroxyprogesterone and small amounts of 6β-hydroxyprogesterone within the first 6h of incubation with progesterone as substrate, hence demonstrating its potential for biotechnological application.