CYCLODEXTRIN glucanotransferase- (CGTase), (EC.2.4.1.19) producing bacteria were isolated from different sources of soils and identified as Bacillus cereus N1 and the best source was the soil of the National Research Centre. The maximum production of the crude CGTase enzyme was observed after 48hr of incubation at 37oC producing CGTase activity of 3.5 U/ml. The effect of nutritional requirements on the CGTase production was carried out. Soluble starch and yeast extracts were found to be the best carbon and nitrogen sources, respectively. The enzyme was successively purified by ammonium sulphate precipitation, DEAE-cellulose and Sephadex G-100 column chromatography and the final specific activity of CGTase enzyme was increased by 24 fold. The SDS-PAGE showed that the purified CGTase enzyme was homogenous and the molecular weight of the purified enzyme was about 75 kDa. The characterization of the enzyme exhibited optimum pH and temperature at 6.0 and 40°C, respectively. The enzyme was stable at pH 6.5 to 8.0 and retained its high activity up to 45°C.