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An actinomycete strain (CB1190T) was previously isolated from industrial sludge contaminated with 1,4-dioxane. The cells of this culture are Gram-positive and exhibit branching aerial and vegetative mycelium. Analysis of the 16S rRNA gene sequence indicates that the strain belongs to the genus Pseudonocardia, closely related to Pseudonocardia hydrocarbonoxydans, P. sulfidoxydans and P. halophobica. Physiological and biochemical characteristics of CB1190T are different from those of other known Pseudonocardia species. The novel organism described here is distinguished by its ability to grow on 1,4-dioxane, which is a probable human carcinogen. This culture can also grow on tetrahydrofuran, gasoline aromatics and several other toxic environmental contaminants. Strain CB1190T is capable of fixing dinitrogen. The predominant fatty acids are 16 : 0 iso, 16 : 1 iso cis9 and 17 : 1 iso cis9. The major phospholipid fatty acids are 16 : 0 iso, 16 : 0 10-Me and 17 : 0 10-Me. The peptidoglycan belongs to type A1γ, meso-diaminopimelic acid. The major menaquinone is MK-8 (H4). Mycolic acids are absent. The G+C content is 74 mol%. Based on morphological, physiological, chemotaxonomic and phylogenetic evidence, it is proposed that strain CB1190T (=ATCC 55486T=DSM 44775T) be classified as the type strain of a novel species, Pseudonocardia dioxanivorans sp. nov. Further studies with this organism will provide insights into metabolic pathways, responsible enzymes, kinetics and the fate of 1,4-dioxane in the environment.