BACKGROUND: The present work aims to study the production of lignin peroxidase (LiP) enzyme by Comamonas sp UVS using various media, and lignocellulosic waste materials, and its effect on decolorization of Direct Blue GILL (DBGLL). RESULTS: Yeast extract medium was found to be more effective for the production of Lip and also for the decolorization of DBGLL. The bagasse powder along with yeast extract induced Lip activity. Comamonas sp UVS decolorized DBGLL dye (50 mg L-1) within 13 h at static condition in YE broth. It could degrade up to 300 mg L-1 of dye within 55 h. The maximum rate (Vmax) of decolorization was 12.41 +/- 0.55 mg dye g cell(-1) h(-1) with the Michaelis constant (Km) value as 6.20 +/- 0.27 mg L-1. The biodegradation was monitored by UV-Vis, GC-MS and HPLC. CONCLUSION: The use of agricultural by-products for the activity enhancement of the ligninolytic enzymes is a cost effective process. It also resolves the problem of the disposal of agro-residues. This system can be applied for the degradation of different recalcitrant compounds. (C) 2008 Society of Chemical Industry