Fifty two strains of anaerobic bacteria isolated from the upper gut of patients with small intestinal bacterial overgrowth were screened for phospholipase activity. Bacteroides melaninogenicus spp intermedius had the greatest activity. The effects of culture supernatants of this organism and deoxycholate on intestinal calcium absorption and disaccharidase activity were studied using a rat closed loop model. The supernatant decreased the in vitro uptake of calcium by 15% (p less than 0.001). Deoxycholate reduced calcium uptake by 16% (p less than 0.001). Combined culture supernatant and deoxycholate reduced calcium uptake by 39% (p less than 0.001) suggesting a potentiation of supernatant activity by deoxycholate. Culture supernatant and deoxycholate, both alone and combined, significantly reduced lactase, sucrase, and maltase activity. Electron microscopic evidence showed degeneration of microvilli, disruption of mitochondrial structure, and swelling of the endoplasmic reticulum after exposure of the intestinal loops to the supernatant or deoxycholate.