To study the beta-glucosidase gene (bgy1) from Lactobacillus brevis that was cloned and expressed in Escherichia coli BL21 (DE3) and then using it for the biotransformation of gypenoside XVII. The bgy1 gene consists of 2283 bp encoding 761 amino acids, with homology to the glycosyl hydrolase family-3 protein domain. The enzyme (Bgy1) hydrolyzed the glucose moieties at the C-3 position and the outer glucose moieties at the C-20 position of gypenoside XVII. Using 0.1 mg enzyme ml(-1) in 20 mM sodium phosphate buffer at 30 A degrees C and pH 6.0, 1 mg gypenoside XVII ml(-1) was transformed into 0.58 mg compound K ml(-1) within 6 h, with a corresponding molar conversion yield of 89 %. The recombinant Bgy1 is considered potentially useful for the practical preparation of compound K.