Among all endophytic keratinolytic fungal isolates recovered from marine soft coral Dendronephthya hemprichii, Penicillium spp. Morsy1 was selected as the hyperactive keratinolytic strain under solid substrate fermentation of different agriculture and poultry wastes. The optimization of extraction process, physicochemical parameters affecting the keratinase production in solid-state fermentation, and the purified keratinase parameters were studied. Maximum keratinase activity (1,600 U g(-1), initial dry substrate) was recovered from moldy bran with 0.1% Tween 80. The optimized production conditions were rice straw as carbon source, pH of medium 6, growth temperature 26 A degrees C, initial moisture content of 80% (v/w), inoculum size of 10(5) spores ml(-1), and an average particle size of the substrate 0.6 mm (3,560 U g(-1), initial dry substrate after 5 days of fermentation). Two types of keratinase (Ahm1 and Ahm2) were purified from the culture supernatant through ammonium sulfate precipitation, DEAE-Sepharose, and gel filtration chromatography. Enzyme molecular weights were 19 kDa (Ahm1) and 40 kDa (Ahm2). The kinetic parameters of purified keratinases were optimized for the hydrolysis of azokeratin by Ahm1 (pH 7.0-8.0, stable in pH range of 6.0 to 8.0 at 50 A degrees C) and Ahm2 enzymes (pH 10.0-11.0, stable in pH range of 6.0 to 11.0 at 60-65 A degrees C). Whereas inhibitors of serine (phenylmethylsulfonyl fluoride) and cysteine (iodoacetamide) proteases had minor effects on both Ahm1 and Ahm2 activity, both keratinases were strongly inhibited by chelating agents EDTA and EGTA. These findings suggest that serine and cysteine residues are not involved in the catalytic mechanisms, and they are metalloproteases.