Soil metagenomes represent an unlimited resource for the discovery of novel biocatalysts from soil microorganisms. Three large-inserts metagenomic DNA libraries were constructed from different grassland soil samples and screened for genes conferring cellulase or xylanase activity. Function-driven screening identified a novel cellulase-encoding gene (cel01) and two xylanase-encoding genes (xyn01 and xyn02). From sequence and protein domain analyses, Cel01 (831 amino acids) belongs to glycoside hydrolase family 9 whereas Xyn01 (170 amino acids) and Xyn02 (255 amino acids) are members of glycoside hydrolase family 11. Cel01 harbors a family 9 carbohydrate-binding module, previously found only in xylanases. Both Xyn01 and Xyn02 were most active at 60A degrees C with high activities from 4 to 10 and optimal at pH 7 (Xyn01) and pH 6 (Xyn02). The cellulase gene, cel01, was expressed in E. coli BL21 and the recombinant enzyme (91.9 kDa) was purified. Cel01 exhibited high activity with soluble cellulose substrates containing beta-1,4-linkages. Activity with microcrystalline cellulose was not detected. These data, together with the analysis of the degradation profiles of carboxymethyl cellulose and barley glucan indicated that Cel01 is an endo 1,4-beta-glucanase. Cel01 showed optimal activity at 50A degrees C and pH 7 being highly active from pH range 5 to 9 and possesses remarkable halotolerance.