20,23-Dihydroxyvitamin D-3 [20,23(OH)(2)D-3] is a biologically active metabolite produced by the action of cytochrome P450scc (CYP11A1) on vitamin D-3. It inhibits keratinocyte proliferation, stimulates differentiation, and inhibits nuclear factor-kappa B activity, working as a vitamin D receptor agonist. We have tested the ability of purified mouse 25-hydroxyvitamin D-3 1 alpha-hydroxylase (CYP27B1) to add a 1 alpha-hydroxyl group to this vitamin D analog and determined whether this altered its biological activity. 20,23(OH)(2)D-3 incorporated into phospholipid vesicles was converted to a single product by CYP27B1, confirmed to be 1 alpha,20,23-trihydroxyvitamin D-3 [1,20,23(OH)(3)D-3] by mass spectrometry and NMR. The 20,23(OH)(2)D-3 was a relatively poor substrate for CYP27B1 compared with the normal substrate, 25-hydroxyvitamin D-3, displaying a 5-fold higher K-m and 8-fold lower k(cat) value. Both 20,23(OH)(2)D-3 and 1,20,23(OH)(3)D-3 decreased neonatal human epidermal keratinocyte proliferation, showing significant effects at a lower concentration (0.1 nM) than that seen for 1 alpha,25-dihydroxyvitamin D-3 [1,25(OH)(2)D-3] at 24 h of treatment. Both compounds also decreased cell biomass relative to that of control cells, measured by staining with sulforhodamine B. They caused little stimulation of the expression of the vitamin D receptor at the mRNA level compared with the 30-fold induction observed with the same concentration (100 nM) of 1,25(OH)(2)D-3 at 24 h. Addition of a 1 alpha-hydroxyl group to 20,23(OH)(2)D-3 greatly enhanced its ability to stimulate the expression of the CYP24 gene but not to the extent seen with 1,25(OH) 2D3. This study shows that purified CYP27B1 can add a 1 alpha-hydroxyl group to 20,23(OH)(2)D-3 with the product showing altered biological activity, especially for the stimulation of CYP24 gene expression.