2-Chloroethylene oxide, a postulated metabolite of vinyl chloride, was found to rearrange to 2-chloroacetaldehyde and to hydrolyze (and dehydrochlorinate) to glycolaldehyde in aqueous buffer. The hydrolysis was catalyzed by apparently homogeneous preparations of rat liver microsomal epoxide hydratase; purified hydratase also lowered the t1/2 of the epoxide in aqueous buffer. 2-Chloroacetaldehyde was reduced by horse liver alcohol dehydrogenase in the presence of NADH and oxidized by yeast aldehyde dehydrogenase in the presence of NADH The NADPH-dependent covalent binding of [14C]vinyl chloride to protein was examined in systems containing rat liver microsomes or highly purified rat liver cytochrome P-450 and NADPH-cytochrome P-450 reductase. Since glycolaldehyde, 2-chloroethanol, and 2-chloroacetic acid are relatively weak alkylating agents, the effects of epoxide hydratase and alcohol and aldehyde dehydrogenases on covalent binding were examined. In a reconstituted system containing cytochrome P-450 and its reductase, >90% of the covalent binding of 14C label from vinyl chloride was blocked by the addition of epoxide hydratase. However, in the microsomal system only 50% of the covalent binding could be blocked by epoxide hydratase but >90% of binding was blocked with either alcohol or aldehyde dehydrogenase. In the microsomal system, neither inhibition of endogenous hydratase with 3,3,3-trichloropropylene oxide nor enhancement of hydratase activity by pretreatment of rats with trans-stilbene oxide affected the level of covalent binding of label from [14C]vinyl chloride. The results demonstrate the use of highly purified enzymes in elucidating the chemistry of activation of compounds to reactive metabolites and indicate (1) that cytochrome P-450 activates vinyl chloride, (2) that 2-chloroethylene oxide is formed from vinyl chloride, (3) that 2-chloroethylene oxide is a substrate for epoxide hydratase, (4) that the rearrangement product 2-chloroacetaldehyde is an important alkylating agent derived from vinyl chloride, and (5) that cytochrome P-450 is effectively segregated from epoxide hydratase and highly nucleophilic groups in microsomal membranes in this process. The work suggests that a highly electrophilic metabolite can form a less reactive compound which may be more effective in biological alkylations. © 1979, American Chemical Society. All rights reserved.