Lipase 3 is a fungal lipase produced industrially for use as a dough-conditioning enzyme in bread making. Mutants of Lipase 3 were designed to improve enzyme specific activity and to prevent N-linked glycosylation, which was found to cause a drop in activity on industrial-scale production. These were based on three-dimensional model structures of Lipase 3 in `open' and `closed' conformational states derived from crystallographic data of fungal lipases sharing high sequence homology. Lipase variants were expressed and secreted by Pichiapastoris yeast and purified by anionexchange chromatography, which allowed the separation of two active isoforms. Analysis of the `glycosylation' mutants by SDS-PAGE and MALDI-TOF mass spectrometry implied that mutation of N-linked glycosylation sites prevented attachment of oligosaccharide groups to these sites. Mutants were characterised by measurement of specific activities with soluble and emulsified substrates and determination of kinetic constants with emulsified substrate. None of the `activity' mutants showed improved activity over wild type, and the significant drop in activity with emulsified substrate on mutation of a `lid' tryptophan residue indicated that this residue was required for interaction with long-chain triacylglycerol substrates. Specific activities and kinetic constants measured for the ‘glycosylation' mutants did not differ significantly from those of the wild type enzyme. Sigmoidal kinetic curves were observed for lipases expressed in Pichia pastoris and Aspergillus niger with emulsified substrate. Co-operativity was measured using the Hill plot and found to be positive. The possibility of a kinetic mechanism, rather than an allosteric mechanism (involving interactions between ligand binding sites), for cooperativity is discussed.