Cinnamoyl co-enzyme A reductase (CCR), one of the key enzymes involved in the biosynthesis of monolignols, has been thought to catalyze the conversion of several cinnamoyl-CoA esters to their respective cinnamaldehydes. However, it is unclear which cinnamoyl-CoA ester is metabolized for monolignol biosynthesis. A xylem-specific CCR cDNA was cloned from aspen (Populus tremuloides) developing xylem tissue. The recombinant CCR protein was produced through an Escherichia coli expression system and purified to electrophoretic homogeneity. The biochemical properties of CCR were characterized through direct structural corroboration and quantitative analysis of the reaction products using a liquid chromatography-mass spectrometry system. The enzyme kinetics demonstrated that CCR selectively catalyzed the reduction of feruloyl-CoA from a mixture of five cinnamoyl CoA esters. Furthermore, feruloyl-CoA showed a strong competitive inhibition of the CCR catalysis of other cinnamoyl CoA esters. Importantly, when CCR was coupled with caffeoyl-CoA O-methyltransferase (CCoAOMT) to catalyze the substrate caffeoyl-CoA ester, coniferaldehyde was formed, suggesting that CCoAOMT and CCR are neighboring enzymes. However, the in vitro results also revealed that the reactions mediated by these two neighboring enzymes require different pH environments, indicating that compartmentalization is probably needed for CCR and CCoAOMT to function properly in vivo. Eight CCR homologous genes were identified in the P. trichocarpa genome and their expression profiling suggests that they may function differentially.