Cytochrome P450 BM3 from Bacillus megaterium is a monooxygenase with great potential for biotechnological applications. In this paper, we present engineered drug-metabolizing P450 BM3 mutants as a novel tool for regioselective hydroxylation of steroids at position 16β. In particular, we show that by replacing alanine at position 82 with a tryptophan in P450 BM3 mutants M01 and M11, the selectivity toward 16β-hydroxylation for both testosterone and norethisterone was strongly increased. The A82W mutation led to a ≤42-fold increase in Vmax for 16β-hydroxylation of these steroids. Moreover, this mutation improves the coupling efficiency of the enzyme, which might be explained by a more efficient exclusion of water from the active site. The substrate affinity for testosterone increased at least 9-fold in M11 with tryptophan at position 82. A change in the orientation of testosterone in the M11 A82W mutant as compared to the orientation in M11 was observed by T1 paramagnetic relaxation nuclear magnetic resonance. Testosterone is oriented in M11 with both the A- and D-ring protons closest to the heme iron. Substituting alanine at position 82 with tryptophan results in increased A-ring proton–iron distances, consistent with the relative decrease in the level of A-ring hydroxylation at position 2β.