The gene (1350-bp) encoding a modular β-1,4-xylanase (XylU), which consists of an N-terminal catalytic GH10 domain and a C-terminal carbohydrate-binding module 2 (CBM 2), from Streptomyces mexicanus HY-14 was cloned and functionally characterized. The purified His-tagged recombinant enzyme (rXylU, 44.0 kDa) was capable of efficiently hydrolyze diverse xylosidic compounds, p-nitrophenyl-cellobioside, and p-nitrophenyl-xylopyranoside when incubated at pH 5.5 and 65°C. Especially, the specific activities (649.8 U/mg and 587.0 U/mg, respectively) of rXylU toward oat spelts xylan and beechwood xylan were relatively higher than those (<500.0 U/mg) of many other GH10 homologs toward the same substrates. The results of enzymatic degradation of birchwood xylan and xylooligosaccharides (xylotriose to xylohexaose) revealed that rXylU preferentially hydrolyzed the substrates to xylobiose (>75%) as the primary degradation product. Moreover, a small amount (4%<) of xylose was detected as the degradation product of the evaluated xylosidic substrates, indicating that rXylU was a peculiar GH10 β-1,4-xylanase with substrate specificity, which was different from its retaining homologs. A significant reduction of the binding ability of rXylU caused by deletion of the C-terminal CBM 2 to various insoluble substrates strongly suggested that the additional domain might considerably contribute to the enzyme-substrate interaction.