Clavibacter michiganense was identified as a microorganism that hydrolyzed the glucosyl ester linkages at site 19 of steviol glycosides. An enzyme that catalyzes the hydrolysis was purified from the cell-free extract using streptomycin treatment, ammonium sulfate fractionation, Q Sepharose anion exchange chromatography, Sephacryl S-100 gel filtration, and Ether Toyopearl hydrophobic chromatography. The purified enzyme migrated as a single protein band in polyacrylamide gel electrophoresis in the presence and absence of sodium dodecyl sulfate, and isoelectric focusing. The molecular mass was estimated to be approximately 65 kDa, both by gel filtration and sodium dodecyl sulfate/polyacrylamide gel electrophoresis. An isoelectric point, pi, of 4.6, was obtained using isoelectric focusing. The enzyme was most active at around pH 7.5 and at 45 degrees C, and was stable between pH 6-10 and below 40 degrees C. Both Hg2+ and p-chloromercuric benzoate inhibited activity. The enzyme hydrolyzed glucosyl ester linkages at site 19 of rebaudioside A, stevioside, rubusoside, and steviol monoglucosyl ester, although it did not cleave 13-O-linked glucosyl residue of rubusoside and steviol monoside. A transglucosylation product having a cellobiosyl residue at site 19 was formed when rubusoside was used as a glucosyl donor and acceptor. The enzyme hydrolyzed glucosidic linkages in p-nitrophenyl beta-glucoside faster than glucosyl ester linkages in the steviol glycosides. It also acted on phenyl beta-glucoside and salicin, and faintly on sophorobiose and cellobiose. These results indicate that the enzyme is a novel beta-glucosidase that hydrolyzes ester linkages.