Benzalacetone synthase (BSA) is a novel plant-specific polyketide synthase that catalyzes a one step decarboxylative condensation of 4-coumaroyl-CoA with malonyl-CoA to produce the C6–C4 skeleton of phenylbutanoids in higher plants. A cDNA encoding BAS was for the first time cloned and sequenced from rhubarb (Rheum palmatum), a medicinal plant rich in phenylbutanoids including pharmaceutically important phenylbutanone glucoside, lindleyin. The cDNA encoded a 42-kDa protein that shares 60–75% amino-acid sequence identity with other members of the CHS-superfamily enzymes. Interestingly, R. palmatum BAS lacks the active-site Phe215 residue (numbering in CHS) which has been proposed to help orient substrates and intermediates during the sequential condensation of 4-coumaroyl-CoA with malonyl-CoA in CHS. On the other hand, the catalytic cysteine-histidine dyad (Cys164–His303) in CHS is well conserved in BAS. A recombinant enzyme expressed in Escherichia coli efficiently afforded benzalacetone as a single product from 4-coumaroyl-CoA and malonyl-CoA. Further, in contrast with CHS that showed broad substrate specificity toward aliphatic CoA esters, BAS did not accept hexanoyl-CoA, isobutyryl-CoA, isovaleryl-CoA, and acetyl-CoA as a substrate. Finally, besides the phenylbutanones in rhubarb, BAS has been proposed to play a crucial role for the construction of the C6–C4 moiety of a variety of natural products such as medicinally important gingerols in ginger plant.