A commercial cellulase was entrapped in liposomes composed of phosphatidylcholine (65 mol%), 1,2-dimyristoyl-sn-glycero-3-phosphoethanolamine (5 mol%) and cholesterol (30 mol%) to prepare the cellulase-containing liposomes (CL) with the enzyme incorporated as much as possible into the membrane. The CL was then immobilized with chitosan gel beads to develop an efficient biocatalyst for enzymatic hydrolysis of cellulose. The activity of the CL prepared was determined with the membrane impermeable substrates such as insoluble filter paper (FP) and soluble carboxymethyl cellulose (CMC). The activity for FP was only several percents of that for CMC. The activity efficiency of the CL for either substrate was found to be about 5%, which suggests that around 5% of the whole cellulase contained in the CL were incorporated in the outer membrane of the liposomes. The CL was coupled with the glutaraldehyde-activated chitosan gel beads to obtain the immobilized cellulase-containing liposomes (ICL). The ICL was repeatedly used in the hydrolysis of both CMC and FP to examine its operational stability. The stability of the ICL was also compared to that of a conventionally immobilized cellulase (IC). As a result, although the activity of the ICL for FP or CMC decreased to 30% or 85%, respectively of the initial activity in its first use, the ICL almost maintained the respective activity for its subsequent uses. The activity of the IC for either substrate decreased steadily from around 70% to 50% of the initial one with the repeated use.