Microorganisms are the important factors in the degradation of the toxic substances in our environment.Petrol and diesel oil is one of the complex mixtures which cannot be easily degraded. The Bacillus cereus was involved in the degradation of oil during which the complex toxic substances were detoxified by the production of biosurfactants. In our study we have identified that the biosurfactant producing Bacillus cereus have a high potential for hydrocarbon degradation. The Bacillus cereus was isolated from hydrocarbon contaminated soil and identified based on morphology and biochemical test according to the Bergey's manual of systematic bacteriology. The maximum hydrocarbon degrading biosurfactant producing Bacillus cereus was obtained by qualitative and quantitative methods. In optimization studies, the best results observed for Bacillus cereus were, Olive oil as the suitable carbon source, Sodium nitrate as the best Nitrogen source and Optimum pH is 7 and Optimum temperature is 37°C. The ability of these isolates to degrade hydrocarbons and survive in the oil contaminated soil is attributed to the development of resistance by mutation on the plasmid. It is also clearly evident that the specific gene was responsible for the production of biosurfactant and the degradation process. According to the results from the present study the Bacillus cereus has high potential for hydrocarbon degradation and can be used especially for Microbial Enhanced Oil Recovery and bioremediation of hydrocarbons in near future.