Using the phage display technology, a protein can be displayed at the surface of bacteriophages as a fusion to one of the phage coat proteins. Here we describe development of this method for fusion of an intracellular carboxylesterase of Bacillus subtilis to the phage minor coat protein g3p. The carboxylesterase gene was cloned in the g3p-based phagemid pCANTAB 5E upstream of the sequence encoding phage g3p and downstream of a signal peptide-encoding sequence. The phage-bound carboxylesterase was correctly folded and fully enzymatically active, as determined from hydrolysis of the naproxen methyl ester with Km values of 0.15 mM and 0.22 mM for the soluble and phage-displayed carboxylesterases, respectively. The signal peptide directs the encoded fusion protein to the cell membrane of Escherichia coli, where phage particles are assembled. In this study, we assessed the effects of several signal peptides, both Sec dependent and Tat dependent, on the translocation of the carboxylesterase in order to optimize the phage display of this enzyme normally restricted to the cytoplasm. Functional display of Bacillus carboxylesterase NA could be achieved when Sec-dependent signal peptides were used. Although a Tat-dependent signal peptide could direct carboxylesterase translocation across the inner membrane of E. coli, proper assembly into phage particles did not seem to occur.