A moderately thermophilic bacterium is described, strain N2-214(T), that was isolated from an enrichment culture, growing on caprolactone, obtained from a sample from a water-treatment sludge aerobic digester operating at temperatures around 60 degrees C. The organism was aerobic, Gram-negative, oxidase- and catalase-positive, with a polar flagellum, and capable of growth at temperatures as high as 61 degrees C. The major fatty acids of strain N2-214(T) were C(16 : 0), C(18 : 1) and cyclo-C(19 : 0). The phylogenetic relationships of the strain, derived from 16S rRNA gene sequence comparisons, demonstrated it to be a member of the beta-subclass of the PROTEOBACTERIA: The highest 16S rDNA sequence similarity of isolate N2-214(T) was to Azoarcus buckelii (91.9 %), Thauera aromatica (92 %) and Hydrogenophilus thermoluteolus (92.7 %). On the basis of phylogenetic analyses and physiological and chemotaxonomic characteristics, it is proposed that isolate N2-214(T) (=DSM 15129(T)=LMG 21637(T)) represents a new genus and species, Tepidiphilus margaritifer gen. nov., sp. nov.