A chitin-degrading Bacillus strain, designated as NCTU2, was screened from soil and identified. An extracellular chitinase was purified to >90% homogeneity from the culture filtrate. The purification involved hydrophobic-interaction and gel-filtration chromatographic separations with a yield of 58%. The purified enzyme (ChiNCTU2) is a monomeric protein with an estimated molecular mass of 36.5 kDa and a pI of 6.3. It is thermally stable at 60 degrees C and pH 6-8 for more than 3 h. The optimal activity is in the range of 50-60 degrees C at pH 7.0. Chitobiose is the predominant product throughout the enzymic hydrolysis of the colloidal chitin, indicating that the purified chitinase is an exo-chitinase. Chito-oligosaccharides [with degree of polymerization (DP) values of 4-6] are good substrates of the purified enzyme, whereas a DP3 oligomer was slowly hydrolysed to form DP1 and DP2 sugars. The first 15 N-terminal amino acids of the enzyme were determined to be ANNLGSKLLVGYWHN, which is highly homologous to that of ChiA from Bacillus cereus. A PCR cloning technique was employed to obtain the corresponding gene from Bacillus NCTU2. The gene sequence was determined to be 1080 bp, encoding a polypeptide of 360 amino acids with the first 27 amino acids as the signal peptide.