Abstract: Optimization of cultural condition that facilitates the degradation of phenol by isolated bacterial strain Acinetobacter johnsonii (from Makkah Al-Mukkarramah region) free and entrapped cells was attempted. Bacterial cells were entrapped in agar-alginate beads. Initial pH of the medium that gave the highest rate of degradation was pH 7 and incubation temperature of 30 ° C. Supplementing the medium with glucose, yeast and meat extract did not improve degradation rate, but it showed an adverse effect. Optimum concentration of ammonium salts, potassium salts and magnesium sulphate were 1.5, 1.2 and 0.3 g L-1, respectively. Optimum concentration of trace elements was 2 ml L-1 and its omission reduced the rate of degradation. Phenol degradation in the air bubble reactor was superior to that of shaken cultures where phenol concentration up to 5 g L-1 were degraded. The dried biocatalyst lost about 73% of its original phenol degradation activity but repeated cultivation restored some of its activity. The same biocatalyst kept 58% of its activity after a 12 weeks storage, while the wet beads lost 62.5% after the same storage period. Small amounts of phenol were fed batch wisely at a high frequency resulting in a phenol degradation higher than that obtained when large amounts were used.