The sequence of gene xynB encoding xylanase B from Paenibacillus sp. BP-23 was determined. It revealed an open reading frame of 999 nucleotides encoding a protein of 38,561 Da. The deduced amino acid sequence of xylanase B shows that the N-terminal region of the enzyme lacks the features of a signal peptide. When the xylan-degrading system of Paenibacillus sp. BP-23 was analysed in zymograms, it revealed that xylanase B was not secreted to the extracellular medium but instead remained cell-associated, even in late stationary-phase cultures. When xynB was expressed in a Bacillus subtilis secreting host, it also remained associated with the cells. Sequence homology analysis showed that xylanase B from Paenibacillus sp. BP-23 belongs to family 10 glycosyl hydrolases, exhibiting a distinctive high homology to six xylanases of this family. The homologous enzymes were also found to be devoid of a signal peptide and seem to constitute, together with xylanase B, a separate group of enzymes. They all have two conserved amino acid regions not found in the other family 10 xylanases, and cluster in a separate group after dendrogram analysis. We propose that these enzymes constitute a new subclass of family 10 xylanases, that are cell-associated, and that hydrolyse the xylooligosaccharides resulting from extracellular xylan hydrolysis. Xylanase B shows similar specific activity on arylxylosides and xylans. This can be correlated to some, not yet identified, trait of catalytic activity of the enzyme on plant xylan.