Chitinase, an antifungal pathogenesis related (PR) protein is present in different isoforms. Class I basic chitinase which is generally more antifungal in nature compared to other chitinase classes, is present in vacuoles. It is speculated that extracellular secretion of this vacuolar enzyme by removing its vacuolar targeting signal at C- terminus might further increase its effectivity. Tobacco class I chitinase cDNA was earlier modified by PCR to add two stop codons before vacuolar targeting signal, so that the protein without this signal would be secreted extracellularly.Transgenic tobacco plants were raised with modified chitinase cDNA and native unmodified cDNA, both under the control of CaMV 35 S promoter, using Agrobacterium mediated transformation. Transgenic plants with unmodified class I chitinase cDNA expressed the enzyme in vacuoles and those having modified cDNA expressed the enzyme in extracellular spaces while retaining its biological activity.