Thirty-two strains of actinomycetes obtained from soil samples of Thailand were selected. Actinomycete strain SU-1 is the most effective in terms of antagonism of Fusarium moniliforme. It produces antifungal substances on agar medium against F. moniliforme. On the basis of microscopical observations of its morphology and biochemical tests as well as analysis of cell wall and fatty acid pattern, this strain was identified as Streptomyces fradiae. The chitinase gene B (chiB337) from No-cardiopsis prasina OPC-131 was inserted into an integrating plasmid pFIS318, an Escherichia coli-Streptomyces shuttle vector. The new plasmid pFIS319-1 carrying the chitinase gene was used to transform protoplasts of S. fradiae strain SU-1. The obtained recombinant strain SU-1 pFIS319-1 exhibited higher chitinase activity than the wild-type in chitinase induction medium. Chitinase activity after renaturing protein from SDS-PAGE was detected rapidly by using 4-methylumbelliferyl beta-D-N,N'-diacetylchitobioside as the substrate. S. fradiae SU-1 secreted two chitinases with estimated molecular masses of 26 kDa and 43 kDa whereas the recombinant strain secreted three chitinases of about 26 kDa, 31.5 kDa (ChiB), and 43 kDa. The supernatant of the recombinant strain grown in chitinase induction medium inhibited the hyphal extension of F. moniliforme.