Sequence analysis of a Paenibacillus sp. BP-23 recombinant clone coding for a previously described endoglucanase revealed the presence of an additional truncated ORF with homology to family 48 glycosyl hydrolases. The corresponding 3509-bp DNA fragment was isolated after gene walking and cloned in Escherichia coli Xl1-Blue for expression and purification. The encoded enzyme, a cellulase of 1091 amino acids with a deduced molecular mass of 118 kDa and a pI of 4.85, displayed a multidomain organization bearing a canonical family 48 catalytic domain, a bacterial type 3a cellulose-binding module, and a putative fibronectin-III domain. The cloned cellulase, unique among Bacillales and designated Cel48C, was purified through affinity chromatography using its ability to bind Avicel. Maximum activity was achieved at 45 degrees C and pH 6.0 on acid-swollen cellulose, bacterial microcrystalline cellulose, Avicel and cellodextrins, whereas no activity was found on carboxy methyl cellulose, cellobiose, cellotriose, pNP-glycosides or 4-methylumbeliferyl alpha-d-glucoside. Cellobiose was the major product of cellulose hydrolysis, identifying Cel48C as a processive cellobiohydrolase. Although no chromogenic activity was detected from pNP-glycosides, TLC analysis revealed the release of p-nitrophenyl-glycosides and cellodextrins from these substrates, suggesting that Cel48C acts from the reducing ends of the sugar chain. Presence of such a cellobiohydrolase in Paenibacillus sp. BP-23 would contribute to widen up its range of action on natural cellulosic substrates.