Lipase belongs to the class of hydrolytic enzymes that are widely used in the biotechnology industries. The goal of this research was to purify and characterize lipase produced from a thermo-halophilic bacterium, namely Pria Laot Sabang 80 (PLS 80). Purification was performed using ammonium sulphate fractionation, followed by gel filtration chromatography using Sepharose Cl-6B. After purification, the enzyme had a specific activity of 326.6 U/mg with a purity of 6.02 higher than the crude extract; with a molecular weight of around 50 kDa. The optimum activity was observed at 70 °C and pH 9. The activity increased in the presence of 10 mM Mn
2+
, K
+
and Ca
2+
ions, while Hg
2+
only slightly increased the enzyme activity. In contrast, the activity decreased in 10 mM Mg
2+
, Zn
2+
, Co
2+
, EDTA, and PMSF. The enzyme showed good hydrolytic activity on long fatty acids substrates (
p
-nitrophenyl palmitate) with a value of 35.5 U/mL. It was also able to catalyze a transesterification reaction. GC-MS result showed that the biodiesel consisted of methyl octanoate (5.3%), methyl caprate (12.4%), methyl laurate (34.1%), methyl myristate (10.7%), methyl palmitate (3.9%), and methyl stearate (1.2%) when using coconut oil as the substrate. The results suggested that the lipase from PLS 80 had unique attributes that could be useful in various industrial applications.