Enzymatic synthesis of cephalexin directly from D-$\alpha$-phenylglycine methyl ester (PGM) and 7-amino-3-deacetoxycephalosporanic acid (7-ADCA) was attempted by using $\mbox{\underline{Xanthomonas}}$ $\mbox{\underline{citri}}$ enzyme. This enzyme showed its maximal reaction rate at pH 6.0 and 37$^\circ$C. An unique kinetic pattern that the maximal conversion achieved was decreased by increasing the amount of enzyme loaded or phenylglycine methyl ester was observed. In order to elucidate this phenomena, all the reaction steps involved in enzymatic synthesis of cephalexin were carefully analyzed by thin layer chrmatographic technique and high performance liquid chromatographic technique. It was confirmed that this enzyme could catalyze the three reactions at least, which are the hydrolysis of phenylglycine methyl ester, transfer of phenylglycyl group to 7-amino-3-deacetoxycephalosporanic acid to form cephalexin, and hydrolysis of cephalexin produced. It was also revealed that the hydrolyzing reactions of phenylglycine methyl ester and cephalexin were not fully reversible. An interesting finding was that the addition of 7-amino-3-deacetoxycephalosporanic acid in hydrolyzing system of phenylglycine methyl ester caused to decrease this hydrolytic rate and to increase the synthetic reaction rate of cephalexin. It was also found that the optimal molar ratio of two substrates in cephalexin synthesis was 3 for its maximal reaction rate. The optimal pHs for three reactions mentioned above were nearly identical at pH 6.0. Based on these findings, a new reaction model for, cephalexin synthesis was proposed having acyl enzyme intermediate. However, the acylated site in this enzyme was not yet detected by chemical modification method. Form the proposed reaction model, the reaction rate equations for three reactions catalyzed by this enzyme were derived by quasi-steady state method. The kinetic parameters were evaluated with varying the concentration of substrates by Linewea...