Sludge from cyanobacteria-salvaged yard in Meiliang Bay, Lake Taihu in Wuxi, China was cultured and acclimated by inoculating microcystins (MCs) extract. Strain J10 was isolated by degrading the MC-RR and MC-LR and was identified as Methylobacillus sp. Further research showed that both MC-LR and MC-RR could be completely degraded at 17h after inoculation of J10, and the degradation probably was mediated by oxygen. Different enzymes, oxygen-dependent as well as oxygen-independent, with MC-degrading activity were found in the different fractions of J10 culture. However, the enzymes mainly responsible for MC degradation by J10 were oxygen-dependent and were probably bound to cell wall or outside the cytoplasmic membrane.