An esterase activity hydrolyzing palmitoyl-CoA was released into the culture medium from Mycobacterium smegmatis. Although another esterase activity hydrolyzing Tween 20 (polyoxyethylene sorbitan monolaurate) was also found in the culture medium, the bulk of the esterase activity was retained in the cells. However, treatment of early-log phase cells with lysozyme to prepare ghosts released 80% of the Tween 20 hydrolyzing activity, indicating the localization of the esterase in the periplasmic space or the cell envelope fraction. The presence of two different esterases hydrolyzing palmitoyl-CoA and Tween 20, suggested by the above results, was confirmed by the separation of these esterases on phenyl-Sepharose column chromatography. Palmitoyl-CoA hydrolase (thioesterase) was purified 630-fold from lysozyme-treated supernatant fluid to homogeneity, by means of Sephadex G-100 gel filtration, and DEAE-cellulose, phenyl-Sepharose and Blue-Agarose column chromatographies. Its molecular weight was approximately 42,000. Tween hydrolase was partially purified 150-fold by the same purification procedure up to the step of phenyl-Sepharose chromatography and its molecular weight was found to be about 51,000. These activities were stable against heating at 60 degrees C and treatment with non-ionic detergents. Thioesterase hydrolyzed long chain acyl-CoAs (C12-C20), but not Tween 20-80 or beta-naphthyl acetate. On the other hand, Tween hydrolase hydrolyzed Tween 20-80 and beta-naphthyl acetate. On the other hand, Tween hydrolase hydrolyzed Tween 20-80 and beta-naphthyl acetate, but not acyl-CoAs. Both esterases hydrolyzed monoolein, but not diolein, triolein, or phosphatidylcholine.