Mutant 32, derived from Rhodotorula glutinis NCIM 3353 produced 76-fold more beta-carotene than the parent strain. In the growth medium prepared in seawater, the total carotenoid content and dry cell mass was 86 mg/l and 16 g/l, respectively, as compared to 70 mg/l and 12 g/l obtained with a medium prepared in distilled water. A 2-fold increase in beta-carotene with simultaneous 2.3-fold decrease in torulene content was also observed. When grown in seawater medium at pH 6.0, 83 +/-5% carotenoids could be extracted from the cells without any mechanical disintegration.