A nonconventional yeast strain Y103 capable of degrading several aromatic hydrocarbons was isolated from the wastewater of the Yocheon industrial complex. The strain Y103 was identified as Yarrowia lipolytica on the basis of its unique dimorphic and biochemical characteristics as determined by a Biolog test. Y. lipolytica Y103 was found to degrade phenol and 4-chlorophenol to produce catechol. The catechol then will be further degraded to produce 2-hydroxymuconic semialdehyde via meta-cleavage. These results indicate that strain Y103 degrades 4-chlorophenol, phenol, and catechol through a consecutive reaction to produce 2-hydroxymuconic semialdehyde. The most active degradation of phenol by Y. lipolytica Y103 occurred with a 0.5 mM phenl concentration in an MM2 medium at $30^{circ}C$ and pH 7.0.