Phenol degradation by Pseudomonas putida CCRC14365 and cell growth kinetics were compared between the free and Ca-alginate gel-immobilized systems. Trends of the effects of pH and temperature on phenol degradation were similar for both free and immobilized cells. Due to the substrate inhibition effect, free cells could degrade phenol only up to about 600 mg/l. While immobilized cells could tolerate a higher level up to 1000 mg/l, although the degradation rate was slower. Growth kinetics of free cells for degradation of phenol in the concentration range 25–600 mg/l was described by the Haldane model. The diffusion effect was not significant in the immobilized systems from the values of effectiveness factor and Thiele modulus, inferring that the degradation process was governed by intraparticle diffusion and chemical reaction. Unlike the case of free cells, intermediate catechol was detected using immobilized cells at a phenol level of 100–400 mg/l. This implied that the occurrence of medium diffusion resistance in the immobilized systems, which retarded the degradation reaction, might be useful for detection of the intermediates.