The gene (pac) encoding beta-lactam acylase from Bacillus badius was cloned and expressed in Escherichia coli. The pac gene was identified by polymerase chain reaction (PCR) using degenerated primers, on the basis of conserved amino acid residues. By using single specific primer PCR (SSP-PCR) and direct genome sequencing, a complete pac gene with its promoter region was obtained. The ORF consisted of 2415 by and the deduced amino acid sequence indicated that the enzyme is synthesized as a preproenzyme with a signal sequence, an a-subunit, a spacer peptide and a (beta-subunit. The pac gene was expressed with its own promoter in different E. coli host strains and a maximum recombinant PAC (1820 U l(-1)) was obtained in E. coli DH5 alpha. The recombinant PAC was purified by Ni-NTA chromatography and the purified PAC had two subunits with apparent molecular masses of 25 and 62 kDa. This enzyme exhibited a high thermostability with a maximum activity at 50 C. This enzyme showed stability over a wide pH range (pH 6.0-8.5) with a maximum activity at pH 7.0 and activity on a wide beta-lactam substrate range. The K, values obtained for the hydrolysis of penicillin G and a chromogenic substrate, 6-nitro-3-phenylacetylamidobenzoic acid, from B. badius PAC were 39 and 41 PM, respectively. The PAC activity was competitively inhibited by PAA (K-i,108 mu M) and noncompetitively by 6-APA (K-i, 17 mM). The constitutive production of B. badius PAC in E. coli and its easier purification together with the advantageous properties, such as thermostability, pH stability and broad substrate specificity, make this as a novel enzyme suitable for beta-lactam industry.