Species of Arthrobacter luteus, also known as Oerskovia xanthineolytica, can utilise yeast cells as a growth substrate. This unusual ability is due to the secretion of a battery of hydrolytic enzymes which degrade the yeast cell wall and thus lyse the cells. Although many hydrolytic enzymes are important in the degradation of the yeast cell wall, the key activities are endo beta--l,3-glucanases. In order to characterise components of the yeast lytic system and the genetic organisation of this little-understood organism, a molecular cloning approach was adopted. Large clones expressing beta-1,3-glucanase were isolated from a library of A. luteus DNA constructed in the positive selection vector pKGW. By a combination of subcloning, restriction mapping and Southern analysis, it was determined that the clones contained virtually the same inserts. Additional subcloning, transposon mutagenesis, deletion mapping and nucleotide sequencing were used to identify at least one glucanase gene. The predicted protein product had a molecular weight of about 46 kD. When the gene was expressed in a number of in vivo and vitro systems including E. coli minicells and a Streptomyces coupled transcription/translation system, the protein observed had a similar molecular weight. Furthermore, when the protein was produced in E. coli and run on activity stained gels, the beta-glucanase activity co-migrated with the major glucanase of A. luteus. In addition the E. coli-produced glucanase had the ability to cause limited lysis of yeast.