A rapidly growing marine derived Bacillus sp. strain NQ-11/A2, identified as Bacillus megaterium, accumulated 61% polyhydroxyalkanoate by weight. Diverse carbon sources served as substrates for the accumulation of short chain length polyhydroxyalkanoate. Three to nine granules either single or attached as buds could be isolated intact from each cell. Maximum activity of polyhydroxyalkanoate synthase was associated with the granules. Granule-bound polyhydroxyalkanoate synthase had a K(m) of 7.1 x 10(-5) M for DL-beta-hydroxybutyryl-CoA. Temperature and pH optima for maximum activity were 30 degrees C and 7.0, respectively. Sodium ions were required for granule-bound polyhydroxyalkanoate synthase activity and inhibited by potassium. Granule-bound polyhydroxyalkanoate synthase was apparently covalently bound to the polyhydroxyalkanoate-core of the granules and affected by the chaotropic reagent urea. Detergents inhibited the granule-bound polyhydroxyalkanoate synthase drastically whilst glycerol and bovine serum albumin stabilized the synthase.