The influence of media and process parameters (aeration and agitation) on fermentation broth rheology and biomass formation has been studied in 1.5-l stirred tank reactor for lipase production using Rhodotorula mucilaginosa MTCC 8737. Molasses, as sole production medium, is used for lipase production by varying aeration (1, 2, and 3 vvm) and agitation speeds (100, 200, and 300 rpm). Maximum lipase activity of 72 U/ml was obtained during 96 h of fermentation at 2 vvm, 200 rpm, pH 7, and 25 +/- 2 degrees C temperature. Lipase production kinetics with respect to dry cell weight of biomass showed Y-P/S of 25.71 U/mg, specific product formation of 10.9 U/mg DC, and Y (X/S) 2.35 mg/mg. Maximum lipase activity (MC 2) of 56 U/ml was observed at 1% molasses, and a further increase in the molasses concentration of (%) 1.5 and 2 inhibited the product formation of lipase with 15 and 8.5 U/ml, respectively. The production kinetics of molasses media showed Y-P/X was 14 U/mg DC, Y (P/S) 16 U/mg, and Y (X/S) 1.14 mg/mg during 96 h of bioreactor operation. The k(L)a values for all batches (MC 1-MC 4) at 96 h of fermentation were 32, 28, 21, and 19/h, and the vertical bar oxygen transfer rate were 54.4, 56, 35.7, and 17.29 mg/l h, respectively. Increase in molasses concentration resulted in decreased lipase activity by increase in viscosity of the fermentation broth.