The penicillin acylase gene (pac) from E. coli ATCC 11105 genomic DNA was cloned into pUC19 vector using conventional techniques. The E. coli strain JM109 transformed by this construct was shown to possess high plasmid stability. PAA upon initial addition to the cultivation medium inhibited cell growth as well as PA production in the recombinant strain. A repressor effect of glucose on PA production was also observed, although the construct did not contain the whole regulatory region of the pac gene. Regulation mechanisms of the pac gene are discussed in the light of previous data and the observed effects of PAA and glucose on penicillin acylase production by the recombinant strain. The penicillin acylase which was constitutively expressed by the recombinant strain was purified and optimal temperature and pH values were found to be 60 degreesC and 8.5, respectively.