Continuous cultures of immobilized Streptomyces kasugaensis, a kasugamycin producer, were carried out on Celite beads. When using a prototype separator for immobilized-cell separation and recycling, the continuous operation could not be sustained for an extended period as a result of an excessive loss of immobilized cells caused by the poor performance of the separator. Accordingly, the immobilized-cell separator was revised to provide better immobilized-cell settling and thus recycling into the reactor. In a subsequent culture using the revised separator, a stable operation was maintained for over 820 h with a high kasugamycin productivity. The kasugamycin productivity ranged from 9.8 to 16.1 mg/L/h, which was about 14- to 23-fold higher than that in a batch suspended-cell culture. When the original feeding medium concentration was doubled at the end of the continuous culture, the productivity became severely impaired for several reasons, which will be discussed. An excessive formation of free cells and loss of immobilized cells through the separator were also observed.