The enzyme catalyzing the hydrolytic cleavage of 2,6-dihydroxypseudooxynicotine to 2,6-dihydroxypyridine and gamma-N-methylaminobutyrate was found to be encoded on pAO1 of Arthrobacter nicotinovorans. The new enzyme answers an old question about nicotine catabolism and may be the first C--C bond hydrolase that is involved in the biodegradation of a heterocyclic compound.