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3-Hydroxyhexobarbital dehydrogenase (3HBD) catalyzes NAD(P)+-linked oxidation of 3-hydroxyhexobarbital into 3-oxohexobarbital. The enzyme has been thought to act as a dehydrogenase for xenobiotic alcohols and some hydroxysteroids, but its physiological function remains unknown. We have purified rabbit 3HBD, isolated its cDNA, and examined its specificity for coenzymes and substrates, reaction directionality and tissue distribution. 3HBD is a member (AKR1C29) of the aldo-keto reductase (AKR) superfamily, and exhibited high preference for NADP(H) over NAD(H) at a physiological pH of 7.4. In the NADPH-linked reduction, 3HBD showed broad substrate specificity for a variety of quinones, ketones and aldehydes, including 3-, 17- and 20-ketosteroids and prostaglandin D2, which were converted to 3α-, 17β- and 20α-hydroxysteroids and 9α,11β-prostaglandin F2, respectively. Especially, α-diketones (such as isatin and diacetyl) and lipid peroxidation-derived aldehydes (such as 4-oxo- and 4-hydroxy-2-nonenals) were excellent substrates showing low Km values (0.1–5.9 μM). In 3HBD-overexpressed cells, 3-oxohexobarbital and 5β-androstan-3α-ol-17-one were metabolized into 3-hydroxyhexobarbital and 5β-androstane-3α,17β-diol, respectively, but the reverse reactions did not proceed. The overexpression of the enzyme in the cells decreased the cytotoxicity of 4-oxo-2-nonenal. The mRNA for 3HBD was ubiquitously expressed in rabbit tissues. The results suggest that 3HBD is an NADPH-preferring reductase, and plays roles in the metabolisms of steroids, prostaglandin D2, carbohydrates and xenobiotics, as well as a defense system, protecting against reactive carbonyl compounds.