Cloning and sequencing of a lipase gene from an indigenous Bacillus pumilus, strain F3, revealed an open-reading frame of 648 nucleotides predicted to encode a protein of 215 residues. Sequence analysis showed that F3 lipase contained a signal peptide composed of 34 amino acids with an H domain of 18 residues. A tat-like motif was found in the signal peptide similar to some other Bacillus pumilus lipases. High similarity was also observed between the protein sequences of the lipases from B. pumilus strains and F3 lipase especially near the catalytic triad, oxyanion hole and tentative lid. Expression of the lipase gene with its native signal peptide in Escherichia coli BL21 (DE3) led to accumulation of lipase as inclusion bodies in cytoplasm due to high hydrophobicity of the protein. Despite inclusion body formation, slight lipolytic activity was detected in periplasm as well as soluble cytoplasmic protein fractions which could show the presence of the recombinant lipase in the periplasmic space of host cell. This may indicate the processing of the lipase by its native signal peptide, although incapable to translocate the enzyme into the Escherichia coli periplasm completely.