The Gram-positive Antarctic bacterium Arthrobacter sp. C2-2 contains two, possibly three cold-active isoenzymes of beta-galactosidase. The C2-2-1 isoenzyme was cloned, purified and characterised. This beta-galactosidase was classified as being a member of the Family 2 of glycosidases. It is a homotetrameric enzyme, each subunit being composed of 1023 arnino acids and it shows great activity towards lactose as a substrate. The C2-2-1 isoenzyme is particularly cold-active, compared to other beta-galactosidases including those from some closely-related bacteria, retaining 20% of activity at 10degreesC compared with maximum values. The temperature optimum of the purified enzyme was 40degreesC using lactose as the substrate. The enzyme is particularly thermolabile, losing all activity within 10 min at 50degreesC. The isoelectric point of the enzyme was 5.9. Dithiothreitol and Mg2+ ions were strong activators, whereas Cu2+, Al3+ and Tris were strong inhibitors of activity. The enzyme exhibited transglycosylation ability and the highest concentration of trisaccharides (34 mM) was formed after 10h at 15degreesC, which is an activity comparable with that of the commercial enzymes. Therefore, the C2-2-1,1,beta-galactosidase isoenzyme of Arthrobacter sp. C2-2 has the particular advantage that it could be used as a biotechnological tool in the production of lactose-reduced dairy products at refrigeration temperatures. (C) 2003 Elsevier Inc. All rights reserved.