Pseudomonas sp. strain SE83 converts cephalosporin C and 7,1-(4-carboxybutanamido)cephalosporanic acid (GL-7ACA) to 7-aminocephalosporanic acid (7ACA). A DNA library of this strain was constructed in Escherichia coli and screened for the ability to deacylate GL-7ACA to 7ACA. Apparently, two distinct genes, designated acyI and acyll, were cloned on 4.8-and 6.0-kilobase-pair BglII fragments, respectively. The enzymes encoded by the two genes showed different substrate specificities, and the acyll-encoded enzyme was found to yield 7ACA from cephalosporin C by direct deacylation. Expression of the two genes in E. coli was strongly dependent on a promoter of the vector. The coding regions for acyI and acyIl were localized on the 2.5-and 2.8-kilobase-pair fragments, respectively, by subcloning experiments, and high expression of both genes was obtained by placing them under the control of the lacUV5 promoter. The acyII-encoded enzyme was purified and shown to be composed of two nonidentical subunits with molecular weights of 26,000 and 57,000. Maxicell analysis revealed three acyIl-specific polypeptides, two of which corresponded to the above subunits. The third polypeptide with a molecular weight of 83,000 was suggested to be the precursor of both subunits.Penicillin and cephalosporin acylases (penicillin amidohydrolase EC 3.5.1.11) catalyze the deacylation of acyl side chains of penicillin and cephalosporin derivatives to yield 6-aminopenicillanic acid and 7-aminocephalosporanic acid (7ACA), respectively, key intermediates for semisynthetic 1-lactam antibiotics for medical use. Through exhaustive screening, many kinds of such activities have been detected in a wide variety of microorganisms. To our knowledge, however, enzymatic deacylation of cephalosporin C having D-a-aminoadipic acid moiety in the acyl side chain has not been confirmed despite claims for such an activity by a few patent applications.Recently, we have isolated from soil a strain of Pseudomonas sp., designated SE83, which has an activity to convert cephalosporin C to 7ACA (manuscript in preparation). Preliminary studies revealed that strain SE83 yielded 7,-(4-carboxy-5-oxopentanamido)cephalosporanic acid and 7p-(4-carboxybutanamido)cephalosporanic acid in addition to 7ACA from cephalosporin C. These compounds have been known to be generated from cephalosporin C through oxidative deamination (11) and subsequent decarboxylation in the presence of H202 as illustrated in Fig.