Cells of Cryptococcus laurentii, which had been isolated from soil as microorganisms utilizing and hydrolyzing L-aminolactam, ** catalyzed the asymmetrical and quantitative hydrolysis reaction of oL-aminolactam, used as a 10% aqueous solution at pH 9.0, producing L-Iysine. A cell-free extract of the yeast cells was fractionated by ammonium sulfate and the active fraction was also used for the hydrolysis of L-aminolactam under various conditions.