Selected actinobacteria and filamentous fungi of different taxonomy were screened for the ability to carry out regio- and stereospecific hydroxylation of lithocholic acid (LCA) at position 7β. The production of ursodeoxycholic acid (UDCA) was for the first time shown for the fungal strains of Bipolaris, Gibberella, Cunninghamella and Curvularia, as well as for isolated actinobacterial strains of Pseudonocardia, Saccharotrix, Amycolatopsis, Lentzea, Saccharopolyspora and Nocardia genera. Along with UDCA, chenodeoxycholic (CDCA), deoxycholic (DCA), cholic (CA), 7-ketodeoxycholic and 3-ketodeoxycholic acids were detected amongst the metabolites by some strains. A strain of Gibberella zeae VKM F-2600 expressed high level of 7β-hydroxylating activity towards LCA. Under optimized conditions, the yield of UDCA reached 90% at 1 g/L of LCA and up to 60% at a 8-fold increased substrate loading. The accumulation of the major by-product, 3-keto UDCA, was limited by using selected biotransformation media.