Abstract Bile salt hydrolase activity in Lactobacillus sp. strain 100–100 is strictly intracellular. The strain produces an extracellular factor that stimulates the intracellular hydrolase activity. The factor is inducible by conjugate bile salts, has an apparent molecular mass over 12 kDa but less than 25 kDa, is stable in air, and resistant to pronase and heat. It is partially extractable into organic solvents and inactivated by a sulhydryl group inhibitor. We postulate that the factor functions by a novel mechanism to facilitate entry of conjugated bile salts into the bacterial cells.