Aims: Isolation, identification and characterization of a highly efficient isomaltulose producer. Methods and Results: After an enrichment procedure for bacteria likely to metabolize isomaltulose in sucrose-rich environments, 578 isolates were screened for efficient isomaltulose biosynthesis using an aniline/diphenylamine assay and capillary electrophoresis. An isolate designated UQ68J was exceptionally efficient in sucrose isomerase activity. Conversion of sucrose into isomaltulose by UQ68J (enzyme activity of 90-100 U mg(-1) DW) was much faster than the current industrial strain Protaminobacter rubrum CBS574.77 (41-66 U mg(-1) DW) or a reference strain of Erwinia rhapontici (0.3-0.9 U mg(-1) DW). Maximum yield of isomaltulose at 78-80% of supplied sucrose was achieved in less than half the reaction time needed by CBS574.77, and the amount of contaminating trehalulose (4%) was the lowest recorded from an isomaltulose-producing microbe. UQ68J is a Gram negative, facultatively anaerobic, motile, noncapsulate, straight rod-shaped bacterium producing acid but no gas from glucose. Based on 16S rDNA analysis UQ68J is closest to Klebsiella oxytoca, but it differs from Klebsiella in defining characteristics and most closely resembles Pantoea dispersa in phenotype. Significance and Impact of Study: This organism is likely to have substantial advantage over previously characterized sucrose isomerase producers for the industrial production of isomaltulose.