A cold-active β-galactosidase of Antarctic marine bacterium Pseudoalteromonas sp. 22b was synthesized by an Escherichia coli transformant harboring its gene and immobilized on glutaraldehyde-treated chitosan beads. Unlike the soluble enzyme the immobilized preparation was not inhibited by glucose, its apparent optimum temperature for activity was 10°C higher (50 vs. 40°C, respectively), optimum pH range was wider (pH 6–9 and 6–8, respectively) and stability at 50°C was increased whilst its pH-stability remained unchanged. Soluble and immobilized preparations of Antarctic β-galactosidase were active and stable in a broad range of NaCl concentrations (up to 3 M) and affected neither by calcium ions nor by galactose. The activity of immobilized β-galactosidase was maintained for at least 40 days of continuous lactose hydrolysis at 15°C and its shelf life at 4°C exceeded 12 months. Lactose content in milk was reduced by more than 90% over a temperature range of 4–30°C in continuous and batch systems employing the immobilized enzyme.