The aim of this study was to characterize the interaction between cellular retinoic acid binding proteins I and II (CRABPI and CRABPII) and CYP26A1 using recombinant CYP26A1 microsomes and purified CRABPs. To characterize the interactions of CRABPs with CYP26A1, the kinetics of 4‐OH‐RA formation from free retinoic acid (RA) or holoCRABP was characterized in the presence and absence of albumin. The effect of apoCRABP on CYP26A1 activity was measured with varying ratios of CRABPs and RA. In the absence of albumin, both holoCRABPI and II had significantly lower Vmax values than free RA but the Km for holoCRABPII was also significantly less than the Km values for holoCRABPI or free RA. In contrast, albumin decreased 4‐OH‐RA formation by >;90% and no RA metabolism was observed by CYP3A4 and CYP2C8 using holoCRABPs as substrate. Both apoCRABPI and II inhibited the metabolism of RA by CYP26A1. The kinetic results were globally fitted to a model that accounts for direct CRABP‐CYP26 interaction and channeling and holoCRABPII and apoCRABPII were found to have Kd values of 86 nM and 47 nM to CYP26A1, respectively. The CRABP binding to CYP26A1 was found to decrease the kcat by a α of 0.55. These data demonstrate that CRABPs channel RA to CYP26A1 and are not acting as a protein sink, like albumin. In addition, the inhibition of CYP26A1 by apoCRABPs suggests that CRABPs interact directly with CYP26A1 and regulate RA concentrations.