Efficient isolation of protoplasts from Taxus cuspidata cultured cells, localization of paclitaxel in the cultured cells, and efficient production of paclitaxel by protoplasts were studied. Hemicellulase, potassium citric acid solution, and degassing treatments were effective in increasing the yield of protoplasts isolated from T. cuspidata cultured cells. Protoplasts yields (3.2 - 6.4 x 10(6) number/g-fresh weight cells) were achieved by combining the various treatments with specific culture and cell phases. It was found that about 30% and 35% of paclitaxel in the cells was located in cell walls and/or between the cell wall and cell membrane (CW) of suspension cells in the growth phase and in the stationary phase, respectively. About 30% and 43% of paclitaxel in the cells was located in CW of the cells grown in solid culture in growth phase and in the stationary phase, respectively. In comparison with cell suspension culture, protoplasts in a static culture and the protoplasts immobilized in agarose gel in shaking culture resulted to about 6 times increase in the extracellular paclitaxel accumulation.