A gram positive bacterium (designated strain SRKP-3) that potentially accumulated polyhydroxyalkanoates (PHAs) was isolated from brackish water. From its morphological and physiological properties and nucleciticle sequence of its 16S rRNA, it was suggested that strain SRKP-3 was similar to Bacillus megaterium. A four-factor central composite rotary design (CCRD) was employed to optimize the medium and to find Out the interactive effects Of four variables, viz. concentrations of dairy waste, rice bran, sea water and pH on PHB production. Using response surface methodology (RSM), a second-order polynomial equation was obtained by Multiple regression analysis and a yield of 6.37 g/L of PHB dry weight was achieved from the optimized medium at pH 9. The same medium was utilized for fermentor studies by fed-batch culture. The dairy waste is fed at three different time intervals at 0th, 12th and 24th hour to keep the carbon source as excess and PHB production was checked for every 3 h. Maximum production of PHB (11.32 g/L) occurred at 36th hour. Dissolved oxygen was found to be major limiting nutrient that affected the PHB synthesis. (C) 2009 Elsevier Ltd. All rights reserved.