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Hydroquinone (HQ) is produced commercially from benzene by multi‐step Hock‐type processes with equivalent amounts of acetone as side‐product. We describe an efficient biocatalytic alternative using the cytochrome P450‐BM3 monooxygenase. Since the wildtype enzyme does not accept benzene, a semi‐rational protein engineering strategy was developed. Highly active mutants were obtained which transform benzene in a one‐pot sequence first into phenol and then regioselectively into HQ without any overoxidation. A computational study shows that the chemoselective oxidation of phenol by the P450‐BM3 variant A82F/A328F leads to the regioselective formation of an epoxide intermediate at the C3=C4 double bond, which departs from the binding pocket and then undergoes fragmentation in aqueous medium with exclusive formation of HQ. As a practical application, an E. coli designer cell system was constructed, which enables the cascade transformation of benzene into the natural product arbutin, which has anti‐inflammatory and anti‐bacterial activities. Unique enzymatic one‐pot dihydroxylation of benzene to hydroquinone: A mutant of a cytochrome P450 monooxygenase catalyzes this challenging transformation with no overoxidation, enabling, among other things, the cascade synthesis of biologically active arbutin. [ABSTRACT FROM AUTHOR]