To obtain an enzyme for the production of chito-disaccharides (GlcN(2)) by converting endo-chitosanase to exo-chitosanase, we chose an endo-chitosanase from Bacillus circulans MH-K1 (Csn) as the candidate for protein engineering. Using molecular modeling, two peptides with five amino acids (PCLGG) and six amino acids (SRTCKP) were designed and inserted after the positions of D(115) and T(222) of Csn, respectively. The inserted fragments are expected to form loops that might protrude from opposite walls of the substrate-binding cleft, thus forming a 'roof' over the catalytic site that might alter the product specificity. The chimeric chitosanase (Chim-Csn) and wild-type chitosanase (WT-Csn) were both over-expressed in Escherichia coli and purified nearly to homogeneity. The products formed from chitosan were analyzed by ESI-MS (electrospray ionization-mass spectrometry). A mixture of GlcN(2), GlcN(3) and GlcN(4) was obtained with WT-Csn, whereas Chim-Csn formed, with a smaller catalytic rate (3% of WT-Csn activity), GlcN(2) as the dominant product. Measurements of viscosity showed that, with similar amounts of enzyme activity, Chim-Csn catalyzed the hydrolysis of chitosan with a smaller rate of viscosity decrease than WT-Csn. The results indicate that, on inserting two surface loops, the endo-type chitosanase was converted into an exo-type chitosanase, which to our knowledge is the first chitosanase that releases GlcN(2) from chitosan as the dominant product.