A catabolite derepressed Bacillus subtilis strain KCC103 was used to produce alpha-amylase in medium containing sugarcane bagasse hydrolysate (SBH). Addition of SBH (1% reducing sugar (w/v)) to the nutrient medium supported maximum alpha-amylase production of 67.4 Um l(-1). HPLC analysis of SBH showed the presence of glucose, xylose and arabinose in the ratio of 0.9:1.0:0.16 (w/w/w). In SBH-medium glucose and xylose were consumed completely while arabinose remained unutilized. Uptake rate of glucose was 2-folds higher than xylose but rate of alpha-amylase production with xylose was 1.5-folds higher than glucose. Arabinose had no effect on growth and alpha-amylase synthesis. Further, alpha-amylase production in SBH-medium was enhanced to 144.5 Um l(-1) (2.2-fold) by response surface methodology where the levels of SBH, and other media components were varied. The modified medium consisted of (in gl(-1)) SBH: 24; peptone: 17.43; yeast extract: 1.32 and beef extract: 1.82. High level of SBH showed no significant inhibition of alpha-amylase synthesis. The derepressed strain KCC103 is useful to produce alpha-amylase economically in short time (30-36 h).