A gene encoding a maltogenic amylase of Bacillus stearothermophilus ET1 was cloned and expressed in Escherichia coli. DNA sequence analysis indicated that the gene could encode a 69,627-Da protein containing 590 amino acids. The predicted amino acid sequence of the enzyme shared 47-70% identity with the sequences of maltogenic amylase from Bacillus licheniformis, neopullulanase from B. stearothermophilus, and cyclodextrin hydrolase (CDase) 1-5 from an alkalophilic Bacillus 1-5 strain. In addition to starch, pullulan and cyclodextrin, B. stearothermophilus could hydrolyze isopanose, but not panose, to glucose and maltose. Maltogenic amylase hydrolyzed acarbose, a competitive inhibitor of amylases, to glucose and a trisaccharide. When acarbose was incubated with 10% glucose, isoacarbose, containing an alpha-1,6-glucosidic linkage was produced as an acceptor reaction product. B. stearothermophilus maltogenic amylase shared four highly similar regions of amino acids with several amylolytic enzymes. The beta-cyclodextrin-hydrolyzing activity of maltogenic amylase was enhanced to a level equivalent to the activity of CDase when its amino acid sequence between the third and the fourth conserved regions was made more hydrophobic by site-directed mutagenesis. Enhanced transglycosylation activity was observed in most of the mutants. This result suggested that the members of a subfamily of amylolytic enzymes, including maltogenic amylase and CDase, could share similar substrate specificities, enzymatic mechanisms and structure/function relationships.