Chitosan raises a great interest among biotechnologists due to its potential for applications in biomedical or environmental fields. Enzymatic hydrolysis of chitosan is a recognized method allowing control of its molecular size, making possible its optimization for a given application. During the industrial hydrolysis process of chitosan, viscosity is a major problem; which can be circumvented by raising the temperature of the chitosan solution. A thermostable chitosanase is compatible with enzymatic hydrolysis at higher temperatures thus allowing chitosan to be dissolved at higher concentrations. Following an extensive micro-plate screening of microbial isolates from various batches of shrimp shells compost, the strain 1794 was characterized and shown to produce a thermostable chitosanase. The isolate was identified as a novel member of the genus Paenibacillus, based on partial 16S rDNA and rpoB gene sequences. Using the chitosanase (Csn1794) produced by this strain, a linear time course of chitosan hydrolysis has been observed for at least 6 h at 70 °C. Csn1794 was purified and its molecular weight was estimated at 40 kDa by SDS-PAGE. Optimum pH was about 4.8, the apparent Km and the catalytic constant kcat were 0.042 mg/ml and 7,588 min⁻¹, respectively. The half-life of Csn1794 at 70 °C in the presence of chitosan substrate was >20 h. The activity of chitosanase 1794 varied little with the degree of N-acetylation of chitosan. The enzyme also hydrolyzed carboxymethylcellulose but not chitin. Chitosan or cellulose-derived hexasaccharides were cleaved preferentially in a symmetrical way ("3+3") but hydrolysis rate was much faster for (GlcN)6 than (Glc)6. Gene cloning and sequencing revealed that Csn1794 belongs to family 8 of glycoside hydrolases. The enzyme should be useful in biotechnological applications of chitosan hydrolysis, dealing with concentrated chitosan solutions at high temperatures.