A bacterium-producing polysaccharide lyase (gellan lyase) was isolated from soil samples and identified to be Bacillus sp. The lyase was purified from the culture fluid of the bacterium (designated Bacillus sp. GL1) grown in the presence of gellan as a carbon source. The purified gellan lyase depolymerized deacetylated gellan and gave a single oligosaccharide product with a molecular weight of 646, which was determined by fast atom bombardment mass spectrometry. The structure of the product was determined by the combination of mass spectrometry, HPLC analysis, and high-resolution proton nuclear magnetic resonance spectroscopy to be a tetrasaccharide of glucuronyl-glucosyl-rhamnosyl-glucose with unsaturated glucuronic acid at the nonreducing terminal. When incubated in cell extracts of Bacillus sp. GL1, the tetrasaccharide was first converted to trisaccharide without unsaturated glucuronyl residue, and the trisaccharide was then converted to hydrolyzed monosaccharides glucose and rhamnose. These results show that, in the bacterium Bacillus sp. GL1, gellan is first depolymerized to give a tetrasaccharide, a repeating unit in gellan molecule, by an extracellular gellan lyase and then the tetrasaccharide is hydrolyzed to monosaccharides by successive actions of intracellular exoglycosidases.