Lipase of Staphylococcus sp. was purified from the culture supernatant, and its molecular mass estimated to be 44 kDa by SDS-PAGE. Its optimum temperature and pH for the hydrolysis of p-nitrophenyl substrates was $28^{circ}C$ and pH 8.5, respectively The gene encoding the lipase was cloned in Escherichia coli in the $NH_2$-teminally truncated form by using the shotgun method, and sequenced. The mature enzyme had a 49-93% amino acid sequence homology with other staphylococcal lipases. This lipase was used for the hydrolysis of the 3-O-acetate of cephalosporin-C to give an intermediate, deacetylated cephalosporin-C that is useful for further chemical elaborations.