beta-Galactosidase is extensively employed in the manufacture of dairy products, including lactose-reduced milk. Here, we have isolated two gram-negative and rod-shaped coldadapted bacteria, BS 1 and HS 39. These strains were able to break down lactose at low temperatures. Although two isolates were found to grow well at 10 degrees , the BS 1 strain was unable to grow at 37 degrees . Another strain, HS-39, evidenced retarded growth at 37 degrees . The biochemical characteristics and the results of 16S rDNA sequencing identified the BS 1 isolate as Rahnella aquatilis, and showed that the HS 39 strain belonged to genus Buttiauxella. Whereas the R. aquatilis BS 1 strain generated maximal quantities of beta-galactosidase when incubated for 60 h at 10 degrees , Buttiauxella sp. HS-39 generated beta-galactosidase earlier, and at slightly lower levels, than R. aquatilis BS 1. The optimum temperature for beta-galactosidase was 30 degrees for R. aquatilis BS-1, and was 45 degrees for Buttiauxella sp. HS-39, thereby indicating that R. aquatilis BS-1 was able to generate a cold-adaptive enzyme. These two cold-adapted strains, and most notably the beta-galactosidase from each isolate, might prove useful in some biotechnological applications.