Catechol-2,3-dioxygenase (C23O) of Pseudomonas putida, encoded by the xylE gene, was found to be sensitive to hydrogen peroxide (H2O2) when used as a reporter in gene fusion constructs. Exposure of Pseudomonas aeruginosa katA or katA katB mutants harboring katA- or katB-lacZ (encoding β-galactosidase) or -xylE fusion plasmids to H2O2 stimulated β-galactosidase activity, while there was little or no detectable C23O activity in these strains. More than 95% of C23O activity was lost after a 5-min exposure to equimolar H2O2, while a 10,000-fold excess was required for similar inhibition of β-galactosidase. Electron paramagnetic resonance spectra of the nitrosyl complexes of C23O showed that H2O2 nearly stoichiometrically oxidized the essential active-site ferrous ion, thus accounting for the loss of activity. Our results suggest using caution in interpreting data derived from xylE reporter fusions under aerobic conditions, especially where oxidative stress is present or when catalase-deficient strains are used.