Factors affecting the production of milk-clotting enzyme (MCE) by Bacillus subtilis (natto) Takahashi, a ready available commercial natto starter, were studied. Remarkable milk-clotting activity (MCA), 685.7SU/ml or 12,000SU/g, was obtained when the bacteria were cultivated in the medium containing sucrose (50g/L) and basal salts at pH 6, 37°C with shaking at 175rpm for 1 day. The MCA and MCA/PA ratio of the crude enzyme obtained are comparable with those of Pfizer microbial rennin and Mucor rennin. The crude enzyme showed excellent pH and thermal stability; it retained 96% of MCA after incubation for 40min at 40°C and retained more than 80% of its activity between pH 4 and pH 7 for more than 30min at 30°C. The MCE of B. subtilis (natto) Takahashi has potential as calf rennet substitutes.