Water soluble chitosan (WSC) was prepared by hydrolysing chitosan using α-amylase. The degradation was monitored by WSC recovery and the WSC structure was characterised by Fourier transform infrared spectroscopy. The optimal hydrolysis conditions were found to be at pH 5, 50°C, 20mg α-amylase in the reaction solution, with a reaction time of 4h. Under these conditions, the average molecular weight of chitosan decreased to 730Da. The resulting products were composed of chitooligosaccharides of DP 3–7. The hydrolysate was neutralised with 1M NaOH, filtered, concentrated to 16% (w/v), precipitated with five volumes of ethanol to one volume of the concentrated hydrolysate solution, and dried at 60°C for 3h to yield a white powder. The WSC content of the product and the yield were 96.2% and 91.2% (w/w), respectively.