beta-Lactoglobulin (beta-LG) denatured with 6 M guanidine hydrochloride (GdnHCl) containing a reducing agent and subsequently dialysed against phosphate-buffered saline (PBS) resulted in incomplete refolding of this protein despite the fact that the biological activity for retinol-binding was recovered to almost the same degree as that of the native molecule [Hattori, M., Ametani, A., Katakura, Y., Shimizu, M., Kaminogawa, S. J., Biol. Chem. 268 (1993) 22414-22419]. The enzyme probe method, evaluation of hydrophilicity values, in-gel mobility on SDS-PAGE, and evaluation of disulfide bonds with the Ellman method showed exposure of the hydrophobic region(s) and incorrect disulfide bond formation in such dialyzed beta-LG molecules. We reveal in this present work that complete refolding could be attained by diluting denatured beta-LG with PBS containing a reducing agent, before slow reoxidation of the sulfhydryl groups upon dialysis for gradient removal of the reducing agent in 6 steps. Complete renaturation was confirmed by analyzing the retinol-binding activity, CD spectra, intrinsic fluorescence, binding ability of monoclonal antibodies (mAbs), and SDS-PAGE. Step-by-step disulfide bond formation was considered to be critical for the complete refolding of denatured beta-LG. Our method can contribute to establish a procedure for complete refolding of useful recombinant proteins in vitro without such biological aids as chaperones.