Extensive analyses on the optimization of growth and enzyme formation have shown that the fungus Ustilago maydis (ATCC 14826) produces a novel extracellular lipolytic enzyme system during growth on 2% coconut oil plus 0.1% olive oil. This lipolytic enzyme system was isolated and investigated for hydrolytic and ester-synthesis properties, in a free as well as in an immobilized form. Fatty acid ethylesters were observed to be the best substrates for the hydrolysis. However, triacylglycerols were the most appropriate substrates for ester-synthesis.