Cloud point system, consisting of nonionic surfactant in an aqueous solution, has been developed as a novel medium for whole cell microbial transformation. The basic properties of cloud point system including phase separation and solubilization are introduced. The application of cloud point system for extractive microbial transformation is different from that of water-organic solvent two-phase partitioning system or aqueous two-phase system are discussed, which mainly focus on the biocompatibility of microorganism in a cloud point system and a downstream process of microbial transformation in cloud point system with oil-water-surfactant microemulsion liquid-liquid extraction for surfactant recovery and product separation. Finally, examples of whole cell microbial transformation in cloud point systems, especially in situ extraction of moderate polar substrate/product, are also presented.