An extracellular enzyme preparation from shipworm bacterium cultures dramatically increased reducing sugar content of carboxymethylcellulose (CMC3), but did not solubilize sugar from particulate cellulose. The preparation degraded cellodextrins larger than cellotriose (G3). Only interior cellodextrin chain linkages were cleaved and the center-most bond of cellohexaose (G6) was preferentially cleaved. Activity maxima were observed at 60 degrees C and between pH 5.0 and 7.0. The activity was resistant to protease treatment and little loss of activity was observed after 14 d at 25 degrees C.