Penicillin G acylase (PGA) is used for the commercial production of semi-synthetic penicillins. It hydrolyses the amide bond in penicillin producing 6-aminopenicillanic acid and phenylacetate. 6-Aminopenicillanic acid, having the beta-lactam nucleus, is the parent compound for all semi-synthetic penicillins. Penicillin G acylase from Kluyvera citrophila was purified and chemically modified to identify the role of arginine in catalysis. Modification with 20 mm phenylglyoxal and 50 mm 2,3-butanedione resulted in 82% and 78% inactivation, respectively. Inactivation was prevented by protection with benzylpenicillin or phenylacetate at 50 mm. The reaction followed psuedo-first order kinetics and the inactivation kinetics (V-max, K-m, and k(cat)) of native and modified enzyme indicates the essentiality of arginyl residue in catalysis.