A process for the preparation of optically active 3-hydroxypyrrolidine or N-substituted 3-hydroxypyrrolidines, wherein an oxygen atom is inserted stereoselectively into the corresponding pyrrolidines, respectively, by use of a bacterium having hydroxylation activity, or a prokaryotic host-organism having the gene(s) necessary for the hydroxylation, or an enzyme having hydroxylation activity derived therefrom. The bacterium may be selected from strains having alkane hydroxylases, strains degrading alkanes or mono-alicyclic compounds, or strains from the genera Pseudomonas, Mycobacterium, Corynebacterium, Nocardia, Sphingomonas, Gordona, Rhodococcus, Bacillus, Streptomyces; Sebekia and Methylococcus.