Steroids are perhaps one of the most widely used group of drugs in present day. Beside the established utilization as immunosuppressive, anti-inflammatory, anti-rheumatic, progestational, diuretic, sedative, anabolic and contraceptive agents, recent applications of steroid compounds include the treatment of some forms of cancer, osteoporosis, HIV infections and treatment of declared AIDS. Steroids isolated are often available in minute amounts. So biotransformation of natural products provides a powerful means in solving supply problems in clinical trials and marketing of the drug for obtaining natural products in bulk amounts. If the structure is complex, it is often an impossible task to isolate enough of the natural products for clinical trials. The microbial biotransformation of steroids yielded several novel metabolites, exhibiting different activities. The metabolites produced from pregnenolone acetate by Cunning hamella elegans and Rhizopus stolonifer were screened against tyrosinase and cholinesterase showed significant inhibitory activities than the parent compound. Diosgenin and its transformed sarsasapogenin were screened for their acetyl cholinesterase and butyryl cholinesterase inhibitory activities. Sarsasapogenin was screened for phytotoxicity, and was found to be more active than the parent compound. Diosgenin, prednisone and their derivatives were screened for their anti-leishmanial activity. All derivatives were found to be more active than the parent compound. The biotransformation of steroids have been reviewed to a little extent. This review focuses on the biotransformation and functions of selected steroids, the classification, advantages and agents of enzymatic biotransformation and examines the potential role of new enzymatically transformed steroids and their derivatives in the chemoprevention and treatment of other diseases. tyrosinase and cholinesterase inhibitory activities, severe asthma, rheumatic disorders, renal disorders and diseases of inflammatory bowel, skin, gastrointestinal tract.