Arene-ruthenium(II) derivatives [RuCl₂(η⁶-C₆H₅OCH₂CH₂OH)(L)] (L = P(OMe)₃ (2a), P(OEt)₃ (2b), P(OⁱPr)₃ (2c), P(OPh)₃ (2d), PPh₃ (2e)) have been prepared from the dimer [{RuCl(μ-Cl)(η⁶-C₆H₅OCH₂CH₂OH)}₂] and the appropriate P-donor ligand. The hydroxyethoxy substituent on the arene induces water-solubility of the resulting complexes (up to 755 g L⁻¹); in particular derivative 2a being one hundred times more soluble in water than its p-cymene congener [RuCl₂(η⁶-p-cymene){P(OMe)₃}]. Compounds 2a–e are active catalysts for isomerization of allylic alcohols into the corresponding ketones in aqueous medium. The best performances are obtained with derivatives 2a–c which have shown the highest activity reported to date for the isomerization of aromatic or disubstituted substrates in water.