A 4.8-kilobase pairs DNA fragment from thermophilic yeast Pichia etchellsii was cloned into the vector plasmid pUC19 to form plasmid pBG55 and the encoded beta-glucosidase expressed in Escherichia coli. The effect of different carbon sources on growth and enzyme synthesis was studied in the pBG55 transformant and 0.2% (w/v) cellobiose found to be the most suitable carbon source for enzyme biosynthesis. The level of intracellularly produced beta-glucosidase was slightly reduced on 0.2% (w/v) glucose and 0.2% (w/v) maltose. The partially purified enzyme from the beta-glu transformant was active against a wide range of aryl beta-glucosides and beta-linked disaccharides and the preferred substrates were p-nitrophenyl-beta-D-glucoside (pNPG), cellobiose, gentiobiose, sophorose and sucrose. While maximum enzyme activity of 62 U/l was against pNPG at 50 degrees C, the activities in the range of 120-170 U/l mere against various beta-linked disaccharides at 37 degrees C. The enzyme displayed glucose tolerance and a temperature optima profile slightly different from that exhibited by the native yeast glycosylated enzyme. The beta-glucosidase in the crude extract of pBG55 transformant was identified as a stably produced protein of 200 kDa by PAGE-Zymogram analysis.