Carbohydrate active enzymes are valuable tools in cereal processing to valorise underutilized side streams. By solubilizing hemicellulose and modifying the fibre structure, novel food products with increased nutritional value can be created. In this study, a novel GH5_34 subfamily arabinoxylanase from Herbinix hemicellulosilytica, HhXyn5A, was identified, produced and extensively characterized, for the intended exploitation in cereal processing to solubilize potential prebiotic fibres; arabinoxylo-oligosaccharides (AXOS). The purified two-domain HhXyn5A (catalytic domain and CBM6) demonstrated high storage stability, showed a melting temperature Tm of 61 °C and optimum reaction conditions were determined to 55 °C and pH 6.5 on wheat arabinoxylan (WAX). HhXyn5A demonstrated activity on various commercial cereal arabinoxylans and produced prebiotic AXOS, while the sole catalytic domain of HhXyn5A did not demonstrate detectable activity. HhXyn5A demonstrated no side activity on oat β-glucan. In contrast to the commercially available homologue CtXyn5A, HhXyn5A gave a more specific HPAEC–PAD oligosaccharide product profile when using WAX and alkali extracted oat bran fibres as substrate. Results from multiple sequence alignment of GH5_34 enzymes, homology modelling of HhXyn5A and docking simulations with ligands XXXA3, XXXA3XX, and X5, concluded that the active site of HhXyl5A catalytic domain is highly conserved and can accommodate both shorter and longer AXOS ligands. However, significant structural dissimilarities between HhXyn5A and CtXyn5A in the binding cleft of CBM6, due to lack of important ligand interacting residues, is suggested to cause the observed differences in substrate specificity and product formation.