Biosynthesis of the commercial carotenoids canthaxanthin and astaxanthin requires β-carotene ketolase. The functional importance of the conserved amino acid residues of this enzyme from Paracoccus sp. strain N81106 (formerly classified as Agrobacterium aurantiacum) was analyzed by alanine-scanning mutagenesis. Mutations in the three highly conserved histidine motifs involved in iron coordination abolished its ability to catalyze the formation of ketocarotenoids. This supports the hypothesis that the CrtW ketolase belongs to the family of iron-dependent integral membrane proteins. Most of the mutations generated at other highly conserved residues resulted in partial activity. All partially active mutants showed a higher amount of adonixanthin accumulation than did the wild type when expressed in Escherichia coli cells harboring the zeaxanthin biosynthetic gene cluster. Some of the partially active mutants also produced a significant amount of echinenone when expressed in cells producing β-carotene. In fact, expression of a mutant carrying D117A resulted in the accumulation of echinenone as the predominant carotenoid. These observations indicate that partial inactivation of the CrtW ketolase can often lead to the production of monoketolated intermediates. In order to improve the conversion rate of astaxanthin catalyzed by the CrtW ketolase, a color screening system was developed. Three randomly generated mutants, carrying L175M, M99V, and M99I, were identified to have improved activity. These mutants are potentially useful in pathway engineering for the production of astaxanthin.