The esterase gene from Streptomyces scabies FL1 was cloned and expressed in Streptomyces lividans on plasmids pIJ486 and pIJ702. In S. lividans, the esterase gene was expressed during later stages of growth and was regulated by zinc, as is seen with S. scabies. The 36-kDa secreted form of the esterase was purified from S. lividans. N-terminal amino acid sequencing indicated that the processing site utilized in S. lividans for the removal of the signal sequence was the same as that recognized for processing in S. scabies. Western blots (immunoblots) revealed the presence of a 40-kDa precursor form of the esterase in cytoplasmic extracts. A 23-amino-acid deletion was introduced into the putative signal sequence for the esterase. When this deleted form of the esterase was expressed in S. lividans, a cytoplasmic 38- kDa precursor protein was produced but no secreted esterase was detected, suggesting the importance of the deleted sequence for efficient processing and secretion. The esterase gene was also cloned into the pUC119 plasmid in Escherichia coli. By using the lac promoter sequence, the esterase gene was expressed, and the majority of the esterase was localized to the periplasmic space.