The celB gene encoding the cellobiose-hydrolyzing enzyme beta-glucosidase from the hyperthermophilic archaeon Pyrococcus furiosus has been identified, cloned, and sequenced. The transcription and translation gene was overexpressed in Escherichia coli, resulting in high-level (up to 20% of total protein) production of beta-glucosidase that could be purified by a two-step purification procedure. The beta-glucosidase produced by E. coli had kinetic and stability properties similar to those of the beta-glucosidase purified from P. furiosus. The deduced amino acid sequence of CelB showed high similarity with those of beta-glycosidases that belong to glycosyl hydrolase family 1, implicating a conserved structure. Replacement of the conserved glutamate 372 in the P. furiosus beta-glucosidase by an aspartate or a glutamine led to a high reduction in specific activity (200- or 1,000-fold, respectively), indicating that this residue is the active site nucleophile involved in catalysis above 100 degrees C.