Abstract Response surface methodology was employed to optimize the cultivation conditions of Penicillium oxalicum SAEM-51 for the enhancement of chitin deacetylase (CDA) production under solid-state fermentation. The enzyme catalyzes deacetylation of N-acetyl glucosamine subunits of chitin resulted in the production of chitosan, widely utilized biopolymer for drug delivery, waste water treatment and as nutraceutics. Among different agro-horticultural substrates evaluated, mustard oil cake had resulted into maximal CDA production. Entrapment of fungal mycelia onto the solid support was studied using scanning electron microscopy. Optimal physico-chemical conditions for maximal CDA production were found to be 4.906g, 73.62% and 8.578% for substrate amount, moisture content and inoculum size, respectively. The experimental CDA production (1162.03±7.2Ugds−1) under optimized condition was observed in close agreement with the values predicted by the quadratic model (1137.85Ugds−1). The CDA production by P. oxalicum SAEM-51 was increased significantly by 1.3 fold, as compared to the un-optimized ones (877.56±8.9Ugds−1).