An extracellular lipase from Pseudomonas luteola was purified 17 fold with 16% recovery by two-phase partitioning, anion exchange and exclusion chromatography. The purified enzyme is relatively thermostable with a half life of 116 min at 65degreesC and an optimal temperature of 55degreesC, The enzyme is unstable at pH 1 but at pH12.25 the half life is 84 min. A preference for medium chain saturated and unsaturated fatty acids was shown while the position and configuration of the acyl double bond had no effect. Of all the metals tested, only divalent Sn and Zn were inhibitory and with detergents a neutral micelle structure was preferred. Sequence comparison with other bacterial lipases showed a close relationship with the Pseudomonas 320-residue lipase group. Homology modeling using the open structure of Ps. cepacia lipase as template demonstrated that the substitutions in the Ps. luteola lipase were of such a nature that the catalytic residues, oxyanion hole, calcium binding site and lid were unaffected. The kinetics and properties of these enzymes are very similar and the substitutions in the binding pocket of the Ps. luteola lipase are unlikely to make its kinetic behavior very different. The Ps. luteola lipase should find biocatalytic applications similar to that of the Ps. cepacia lipase.