The major objective of this study was to engineer lactic acid bacteria to produce the enzyme phytase from a gene native to Bacillus subtilis GYPB04. The phytase gene (phyC) of B. subtilis GYPB04 was cloned into the plasmid pMG36e for expression in Lactococcus lactis. The enzyme activity in L lactis cultured in GM17 broth was 20.25 U/mL at 36 degrees C. The expressed phytase was characterized as active in a pH range of 2.0-9.0 at a temperature range of 20-80 degrees C, with an optimum pH of 5.5-6.5 and temperature of 60 degrees C. When cultured in food-grade milk broth, the transformed L lactis grew to an OD600 nm value of 1.05 and had a phytase yield of 13.58 U/mL. In same broth under optimized conditions for cell growth and phytase production, the transformant reached an OD600 nm value of 1.68 and a phytase yield of 42.12 U/mL, representing approximately 1.6-fold and 3.1-fold increases, respectively, compared to growth in natural milk broth. Fermentation was scaled to 5 L under optimized conditions, and product analysis revealed a final OD600 (nm) value of 1.89 and an extracellular enzyme activity of 24.23 U/mL. The results of this study may be used in the dairy fermentation industry for the development of functional, healthy yogurts and other fermented dairy foods that provide both active phytase and viable probiotics to the consumer. (C) 2013, The Society for Biotechnology, Japan. All rights reserved.