Aims: To isolate the biologically active fraction of the lipopeptide biosurfactant produced by a marine Bacillus circulans and study its antimicrobial potentials. Methods and Results: The marine isolate B. circulans was cultivated in glucose mineral salts medium and the crude biosurfactant was isolated by chemical isolation method. The crude biosurfactants were solvent extracted with methanol and the methanol extract was subjected to reverse phase high-performance liquid chromatography (HPLC). The crude biosurfactants resolved into six major fractions in HPLC. The sixth HPLC fraction eluting at a retention time of 27.3 min showed the maximum surface tension-reducing property and reduced the surface tension of water from 72 mNm(-1) to 28 mNm(-1). Only this fraction was found to posses bioactivity and showed a pronounced antimicrobial action against a panel of Gram-positive and Gram-negative pathogenic and semi-pathogenic micro-organisms including a few multidrug-resistant (MDR) pathogenic clinical isolates. The minimum inhibitory concentration (MIC) and minimum bactericidal concentration (MBC) of this antimicrobial fraction of the biosurfactant were determined for these test organisms. The biosurfactant was found to be active against Gram-negative bacteria such as Proteus vulgaris and Alcaligens faecalis at a concentration as low as 10 mu g ml(-1). The biosurfactant was also active against methicillin-resistant Staphylococcus aureus (MRSA) and other MDR pathogenic strains. The chemical identity of this bioactive biosurfactant fraction was determined by post chromatographic detection using thin layer chromatography (TLC) and also by Fourier transform infrared (FTIR) spectroscopy. The antimicrobial HPLC fraction resolved as a single spot on TLC and showed positive reaction with ninhydrin, iodine and rhodamine-B reagents, indicating its lipopeptide nature. IR absorption by this fraction also showed similar and overlapping patterns with that of other lipopeptide biosurfactants such as surfactin and lichenysin, proving this biosurfactant fraction to be a lipopeptide. The biosurfactant did not show any haemolytic activity when tested on blood agar plates, unlike the lipopeptide biosurfactant surfactin produced by Bacillus subtilis. Conclusions: The biosurfactant produced by marine B. circulans had a potent antimicrobial activity against Gram-positive and Gram-negative pathogenic and semi-pathogenic microbial strains including MDR strains. Only one of the HPLC fractions of the crude biosurfactants was responsible for its antimicrobial action. The antimicrobial lipopeptide biosurfactant fraction was also found to be nonhaemolytic in nature. Significance and impact of the Study: This work presents a nonhaemolytic lipopeptide biosurfactant produced by a marine micro-organism possessing a pronounced antimicrobial action against a wide range of bacteria. There is a high demand for new antimicrobial agents because of the increased resistance shown by pathogenic micro-organisms against the existing antimicrobial drugs. This study provides an insight into the search of new bioactive molecules from marine micro-organisms.