Microbial lipases catalyzing the hydrolysis and synthesis of esters from glycerol and fatty acids are commercially important in food, dairy, detergent and leather industries. In the present study, 15 thermo-alkalophilic bacterial strains isolated from a compost soil sample were screened for lipase production in beef extract nitrate medium containing 1% tributyrin. The strain 8C, giving maximum lipolytic activity was morphologically and biochemically identified as Bacillus sp. Lipase production from strain 8C was optimized by studying effects of incubation period, initial pH of medium, carbon and nitrogen sources, metals, substrates and thiols under static conditions. Lipase production was maximum after 7 days of incubation at 50°C and pH 9.0 and when sesame oil was used as a substrate. Supplementation of ribose or raffinose and ammonium sulphate (1%) as sole sources of carbon and nitrogen also stimulated lipase production over control. Of the different thiols tested, methionine greatly increased lipase production (175 Eu mLG 1 ) whereas, FeCl 3 (50 mM) found to be most suitable metal salt for optimal lipase production (300 Eu mLG 1 ). Under optimized conditions, lipase production by thermo-alkalophilic Bacillus sp. 8C was increased by 6.36 fold compared to unoptimized conditions. Key words: Thermophilic, alkaline, ribose, FeCl 3 , methionine, sesame oil INTRODUCTIONLipases (triglycerol hydrolases (EC 3.1.1.3) are the hydrolytic enzymes belonging to serine hydrolase family and catalyze conversion and synthesis of esters from glycerol and fatty acids. Lipolytic reactions are highly chemo-, regio and or enantioselective and operate at the interface of oil and water (Nguyen et al., 2010). High quality and low energy consumption of lipase catalyzed reactions make them superior over conventional steam splitting methods operating at high temperature and pressure (Treichel et al., 2010). These characteristics of lipases increased their demand in different industries including food and dairy, detergent, cosmetics, leather, paper and pulp, biodiesel and pharmaceutical (Hasan et al., 2007).Thermophilic lipases are of special interest for industrial applications due to their stability and high activity at higher temperatures and being stable in presence of chemicals (Messias et al., 2009;Uttatree et al., 2010). Lipases being third largest selling group of enzymes with more than 1000 t of annual production and approaching to a billion dollar business. Lipases active at alkaline pH are of great importance in detergent industry where these enzymes are used for removal of fat stains and dirt (Bora and Bora, 2012). The use of alkaline lipases in detergent formulation substantially