In the anaerobic, thermophilic, cellulolytic bacterium Clostridium thermocellum, efficient solubilization of the insoluble cellulose substrate is accomplished largely through the action of a cellulose-binding multienzyme complex, the cellulosome. A major cellobiohydrolase activity from the cellulosome has been traced to its Mr 75,000 S8 subunit, and an active fragment of this subunit was prepared by a novel procedure involving limited proteolytic cleavage. The truncated Mr 68,000 fragment, termed S8-tr, was purified by gel filtration and high-performance ion-exchange chromatography. The purified protein adsorbed weakly to amorphous cellulose, and its enzymatic action yielded cellobiose as the major end product from both amorphous and crystalline cellulose preparations. The high ratio of exo- to endo-beta-glucanase activities was supported by viscosimetric measurements. The use of model substrates showed that the smallest cellodextrin to be degraded was cellotetraose, but cellopentaose was degraded at a much greater rate. Cellobiose dramatically inhibited the cellulolytic activities. In the absence of calcium or other bivalent metal ions, both the truncated cellobiohydrolase activity of S8-tr and the true cellulase activity of the parent cellulosome were relatively unstable at temperatures above 50 degrees C. Cysteine further enhanced the stabilizing effect of calcium. This is the first report of a defined cellobiohydrolase in C. thermocellum. Its association with the cellulosome and the correspondence of several of their major distinctive properties suggest that this cellobiohydrolase plays a key role in the solubilization of cellulose by the intact cellulosomal complex.