Recombinant protein production is a vast field growing larger in each passing year due to continuous emergence of new host, vectors and techniques for cloning and expression. Earlier, a Bacillus lipase gene was cloned in pGEMT/ E. coli DH5α with 12 units/ml lipase production. In the present investigation, attempt has been made to optimize the production of recombinant lipase by E. coli by varying different parameters. Amongst the different strains of E. coli, M46 cells were observed to be the best host with 19 units/ml lipase production. Addition of surfactant and changing media to nutrient broth lead to 2.8 fold and 1.3 fold respective increase in lipase production. Amongst different vectors, pET 28a vector showed the highest total lipase production but it proved toxic for the cells, while pQE30-UA vector gives 5 fold enhanced total lipase production with more stable expression. With the combination of optimized host, vector, surfactant and media, 18 fold increases in lipase production (214 units/ml) was achieved.