A bacterium K-4-3, producing $eta$-glucan hydrolyzing enzyme, was isolated from soil and identified to be Bacillus subtilis by its morpholohical and physiological characteristics. $eta$-glucan was coloured using cibacron blue 3G-A and cross linded by the addition of 1, 4-butanedioldiglycidyl ether. This substrate was used for the isolation of $eta$-glucanase producing microorganism. The $eta$-glucan hydrolyzing enzyme actibity from isolated K-4-3 strain was also measured using the modified substrate. Bacillus subtilis K-4-3 produced the highest extracellular $eta$-glucan hydrolyzing activity in the basal medium containing $eta$-glucan as a carbon source, peptone and tryptone as a nitrogen source, and magnesium sulfate as an inorganic salt. The optimum temperature and initial pH for $eta$-glucanase production by Bacillus subtilis K-4-3 were $37^{circ}C$ and pH6. The highest enzyme activity was obtained at the culture age of 54 hrs with rotary shaking at $37^{circ}C$. The crude enzyme showed the highest activity at pH 7.5-8.0 and $65^{circ}C$.