The lipase gene (lipA) and its activator gene (lipB) of Pseudomonas sp. SW-3 were cloned and sequenced. The lipB was found to be present immediately downstream of lipA. The deduced amino acid sequences of lipA and lipB showed a high level of homology to those of other lipases belonging to the family I.1 of bacterial lipases. When lipA was expressed in Escherichia coli using T7 promoter, an active lipase was produced in cells carrying both lipA and lipB, but not in cells harboring only lipA. Recombinant lipase (rPSL) overproduced in an insoluble form was solubilized in the presence of 8 M urea, purified in a urea-denatured form and refolded by removing urea in the presence of the Ca$^$2+/ ion. rPLS had maximum activity at pH 8.0 and 50$^{circ}C$, was stable at pHs from 7.0 to 9.0 and below 50$^{circ}C$, and showed the highest activity toward the p-nitrophenyl ester of palmitate (Cl6).