Although a number of plant natural products are derived from benzoic acid, the biosynthesis of this structurally simple precursor is poorly understood. Hypericum calycinum cell cultures accumulate a benzoic acid-derived xanthone phytoalexin, hyperxanthone E, in response to elicitor treatment. Using a subtracted complementary DNA (cDNA) library and sequence information about conserved coenzyme A (CoA) ligase motifs, a cDNA encoding cinnamate:CoA ligase (CNL) was isolated. This enzyme channels metabolic flux from the general phenylpropanoid pathway into benzenoid metabolism. HcCNL preferred cinnamic acid as a substrate but failed to activate benzoic acid. Enzyme activity was strictly dependent on the presence of Mg²⁺ and K⁺ at optimum concentrations of 2.5 and 100 mm, respectively. Coordinated increases in the Phe ammonia-lyase and HcCNL transcript levels preceded the accumulation of hyperxanthone E in cell cultures of H. calycinum after the addition of the elicitor. HcCNL contained a carboxyl-terminal type 1 peroxisomal targeting signal made up by the tripeptide Ser-Arg-Leu, which directed an amino-terminal reporter fusion to the peroxisomes. Masking the targeting signal by carboxyl-terminal reporter fusion led to cytoplasmic localization. A phylogenetic tree consisted of two evolutionarily distinct clusters. One cluster was formed by CoA ligases related to benzenoid metabolism, including HcCNL. The other cluster comprised 4-coumarate:CoA ligases from spermatophytes, ferns, and mosses, indicating divergence of the two clades prior to the divergence of the higher plant lineages.