Production of biofuels from non-food-based materials, such as lignocellulose, provides a good alternative for the traditional burning of fossil fuels. Some of the researched and existing biofuel applications are based on the utilization of enzymes. There are multiple cellulolytic enzymes required in the efficient hydrolysis of lignocellulose, and one of the key enzyme group is β-glucosidases. These enzymatic systems are mainly adopted from wood-decaying fungi. The overall enzymatic system consists of different types of cellulases that first degrade the crystalline cellulose to oligosaccharides and cellobiose. In the final step, β-glucosidases hydrolyse the oligosaccharides to glucose (a fermentable sugar). In fact, β-glucosidases are one of the limiting enzyme classes in this process, due to phenomena such as end-product inhibition. β-Glucosidases belong to Glycoside hydrolases (GH), that can be classified into different protein families. In an industrial perspective, the main interest resides in GH1 and GH3 family enzymes. Many industrially relevant extracellular β-glucosidases belong to GH3 family. However, intracellular GH1 β-glucosidases often exhibit higher tolerance to harsh conditions such as high substrate and product concentrations, high temperatures and low pH. The goal of this MSc thesis work was to purify and characterize a novel GH1 β-glucosidase, named NBG. Both GH1 and GH3 family enzymes were used as references for the characterization work. The GH3 reference enzyme was a β-glucosidase from Aspergillus niger (An Cel3A), derived from the commercial enzyme preparation Novozym 188. The used GH1 reference was a β-glucosidase from termite Nasutitermes takasagoensis (Nt GH1). The applicability of NBG β-glucosidase in biomass hydrolysis was also examined, together with possible considerations for applicability by other type of applications. The purification of An Cel3 reference enzyme was performed as described previously in literature. A novel protocol combining thermal treatment and low resolution IEX purification was developed for the NBG enzyme in this study. The enzyme’s activity on various pNP-substrates was determined, followed by pH stability, thermostability and inhibition studies. According to the result, NBG is a potential candidate for industrial use. The enzyme was found to be thermostable and active in a wide pH range when compared to the reference enzymes (stable up to 20 h at +60 ˚C and in pH 3.5 – 6.0). NBG also exhibited wider activity on pNP-substrates than the reference enzymes, highest specific activity being on pNPG, followed by moderate activity on pNPFuc and low activities on pNPGal and pNPXyl. Furthermore, NBG exhibited higher tolerance to inhibitors such as glucose and ethanol. Glucose inhibition was not observed until concentration of 200 mM for NBG, while in the same concentration the reference enzymes were almost completely inhibited. A Clear activation (of +16 %) by 100 mM glucose was observed with NBG. This enzyme also outperformed the An Cel3A-reference in ethanol tolerance, retaining activity better in 15 and 20 % ethanol. Activation by ethanol was also observed for both of the fungal enzymes, the most pronounced effect being observed for NBG in 15 % ethanol (+21 % of initial activity). The hydrolysis of insoluble cellulosic substrate (Avicel) was investigated using a commercial cellulase mixture (Celluclast 1.5L), where a semi-pure β-glucosidase preparation was added: novel β-glucosidase preparation (NBG (2-S2)) or the reference preparation An Cel3A (Nz188). According to the results, the NBG (2S-2) was outperformed by An Cel3A (Nz188) in Avicel 4 – 72 h hydrolysis experiments. The amount of reducing sugars released from Avicel was approximately 18–19 % higher with the commercial Nz188 preparation when compared to the 2S-2 preparation. Further analyses of samples revealed accumulation of cello-oligosacchardes, which may accumulate due to two possible reasons: Either the NBG enzyme does not possess high enough cellobiase activity (needed in biomass hydrolysis to glucose), or accumulation of cellobiose is due to transglycosylation activity of NBG. According to activity (and 3D modelling) data, NBG may not be a true β-glucosidase belonging to the EC 3.2.1.21 (and having cellobiase activity). Further investigation of the possible substrate specificity and transglycosylation activity of the NBG will be needed in assessing its applicability in other types of biotechnical applications.