A highly thermostable xylanase isolated from the thermophilic fungus Paecilomyces varioti has been crystallized by the vapour diffusion method. The isolation of this enzyme by crystallization directly from the culture filtrate projects this fungus as an important source for large-scale production of pure xylanase. The crystals belong to orthorhombic space group P2(1)2(1)2(1) with the unit cell dimensions a = 38.48 A, b = 53.87 A and c = 90.23 A. Four molecules occupy a volume of 187,039.4 A3 along with 34% of solvent. The data collected with an area detector to the resolution of 2.7 A were used to calculate the unit cell parameters and Matthews' constant. The optical behaviour of the crystal was studied at different temperatures to understand its thermal stability.