Alternan is an unusual alpha-D-glucan containing alternating (1 --> 3), (1 --> 6) linkages that exhibits remarkable resistance to enzymatic hydrolysis. The commercial potential of the polysaccharide may be enhanced by the ability to economically modify the native form into fractions of varying molecular weight, By employing isolation procedures with covalently dyed alternan as the substrate, several bacterial isolates that produced endohydrolytic activity were obtained in pure culture. The activity was confirmed by decreases in viscosity and by direct examination of the hydrolysis products with thin layer chromatography. Analysis of the hydrolysis products established that all isolates produced enzymes with identical alternan depolymerizing activity, producing a cyclic tetrasaccharide as a major product, All alternanase activity was shown to be extracellularly located. A single strain exhibited constitutive production of alternanase, while all other isolates required the presence of alternan in the growth media for enzyme production. All isolates were phenotypically similar, produced heat-resistant spores, and were tentatively identified as members of the genus Bacillus.