A 3.2 kilobase pair DNA fragment from Thermus thermophilus HB27 coding for a beta-galactosidase activity was cloned and sequenced. A gene and a truncated open reading frame orf1 encoding respectively a beta-glycosidase (ttbeta-gly) and probably a sugar permease were located directly adjacent to each other. The deduced aminoacid sequence of the enzyme Ttbeta-gly showed strong identity with those of beta-glycosidases belonging to the glycosyl hydrolase family 1. The enzyme was overexpressed in Escherichia coli and was purified by a two-step purification procedure. The recombinant enzyme is monomeric with a molecular mass of 49-kDa. It catalyzes the hydrolysis of beta-D-galactoside, beta-D-glucoside and beta-D-fucoside derivatives. However, the kcat/Km ratio is much higher for p-nitrophenyl-beta-D-glucoside and p-nitrophenyl-beta-D-fucoside than for p-nitrophenyl-beta-D-galactoside. The specificity towards linkage positions of the disaccharides tested decreased in the following order: beta1-3 (100%) > beta1-2 (71%) > beta1-4 (40%) > beta1-6 (10%). Ttbeta-gly is a thermostable enzyme displaying an optimum temperature of 88 degrees C and a half life of 10 min at 90 degrees C. It performs transglycosylation reactions at high temperature with a yield exceeding 63% for transfucosylation reactions. On the basis of this work, the enzyme appears to be an attractive tool in the synthesis of fucosyl adducts and fucosyl sugars.