An amperometric enzyme biosensor for continuous detection of cellobiose has been implemented as an enzyme assay for cellulases. We show that the initial kinetics for cellobiohydrolase I, Cel7A from Trichoderma reesei, acting on different types of cellulose substrates, semi-crystalline and amorphous, can be monitored directly and in real-time by an enzyme-modified electrode based on cellobiose dehydrogenase (CDH) from Phanerochaete chrysosporium (Pc). PcCDH was cross-linked and immobilized on the surface of a carbon paste electrode which contained a mediator, benzoquinone. An oxidation current of the reduced mediator, hydroquinone, produced by the CDH-catalyzed reaction with cellobiose, was recorded under constant-potential amperometry at +0.5 V (vs. Ag/AgCl). The CDH-biosensors showed high sensitivity (87.7 µA mM−1 cm−2), low detection limit (25 nM), and fast response time (t95% ∼ 3 s) and this provided experimental access to the transient kinetics of cellobiohydrolases acting on insoluble cellulose. The response from the CDH-biosensor during enzymatic hydrolysis was corrected for the specificity of PcCDH for the β-anomer of cello-oligosaccharides and the approach were validated against HPLC. It is suggested that quantitative, real-time data on pure insoluble cellulose substrates will be useful in attempts to probe the molecular mechanism underlying enzymatic hydrolysis of cellulose. Biotechnol. Bioeng. 2012; 109: 3199–3204. © 2012 Wiley Periodicals, Inc.