We report here on the purification, characterization, molecular cloning, and expression of a new aminoacylase, initially isolated from the supernatant of Streptomyces mobaraensis (Sm-AA). Purified wild-type Sm-AA was found to be a monomeric protein with a molecular mass of 55 kDa. The cloned gene of Sm-AA contained an ORF of 1,383 bp, encoding a polypeptide of 460 amino acids. A BLAST search revealed that Sm-AA belongs to the peptidase M20 family, with identities to a hypothetical protein from Streptomyces pristinaespiralis, a putative peptidase from Streptomyces avermitilis, peptidase M20 from Frankia sp., succinyl-diaminopimelate desuccinylase from Hemophilus influenzae, and aminoacylase-1 from porcine kidney at 89, 88, 67, 29, and 25% respectively. The Sm-AA gene was subcloned into an expression vector, pSH19, and was expressed in Streptomyces lividans TK24. The amount of the recombinant Sm-AA expressed in the S. lividans cells was approximately 42-fold higher than that of Sm-AA found in the supernatant of S. mobaraensis. Sm-AA showed high hydrolytic activity towards various N-acetyl-L-amino acids and N-(middle/long)-chain-fatty-acyl-L-amino acids, with a preference for the acyl derivatives of L-Met, L-Ala, L-Cys, etc. with an optimum pH and temperature for reaction of about 7.5 and 50 degrees Celsius (at pH 7.5).