Aculeacin A acylase (AAC), produced by Actinoplanes utahensis, catalyzes the hydrolysis of the palmitoyl moiety of the antifungal antibiotic, aculeacin A. Using mixed oligodeoxyribonucleotide probes based on the N-terminal amino acid (aa) sequences of the two subunits of AAC, overlapping clones were identified in a cosmid library of A. utahensis DNA. After the sub-cloning of a 3.0-kb fragment into Streptomyces lividans, the recombinant produced AAC extracellularly. The nucleotide sequence of this fragment predicted an open reading frame of 2358 bp with GTG start and TGA stop codons. The deduced 786-aa sequence should correspond to a single polypeptide chain, indicating that this polypeptide is processed to the active form which is composed of the two subunits. Threefold more AAC was obtained from the S. lividans recombinant carrying the cloned gene than the original A. utahensis strain.