Cascade conversion of chitin into soluble and functional chitooligosaccharides has gained great attention. However, the biotransformation route is still limited to the low catalytic performances of chitin deacetylases (CDAs) and complicated procedures. In this study, a CDA from Arthrobacter sp. Jub115 (ArCDA) was identified and characterized, which showed a higher catalytic stability than the reported CDAs, with residual activity of 80.49%, 71.12%, and 56.09% after incubation at 30, 35, and 40 °C for 24 h, respectively. Additionally, ArCDA was identified to have a broad substrate spectrum toward β-chitin and N-acetyl chitooligosaccharides. Moreover, an engineered chitin-degrading bacteria (CDB) with cell-surface-displayed deacetylase ArCDA and chitinase SaChiB was constructed to simplify catalysis procedures, facilitating the chitobiose production of 294.30 ± 16.43 mg/L in 10 h. This study not only identified a CDA with the desirable catalytic performance but also provided a strategy for constructing CDB, facilitating the high-value utilization of chitin.