The gene encoding an esterase (HDE) was cloned from an oil-degrading bacterium, strain HD-1. HDE is a member of the hormone-sensitive lipase family and composed of 317 amino acid residues with a molecular weight of 33,633. The HDE-encoding gene was expressed in Escherichia coli, and the recombinant protein was purified and characterized. Amino acid sequence analysis indicated that the methionine residue was removed from its NH(2)-terminus. The good agreement of the molecular weights estimated by SDS-PAGE (35,000) and gel filtration (38,000) suggests that it acts in a monomeric form. HDE showed hydrolytic activity towards p-nitrophenyl esters of fatty acids with an acyl chain length of 2 to 14 and tributyrin, whereas it showed little hydrolytic activity towards p-nitrophenyl oleate (C(18)), tricaprylin and triolein. Determination of the kinetic parameters for the hydrolyses of the p-nitrophenyl substrates from C(2) to C(14) indicated that HDE shows a relatively broad substrate specificity. However, comparison of the k(cat)/K(m) values indicated that the C(10)-C(14) substrates are the most preferred ones. Such a preference for substrates with long acyl chains may be a characteristic of HDE.