Abstract An effective biosurfactant-producer and hydrocarbon degrading bacterial strain, Bacillus methylotrophicus USTBa was isolated from hydrocarbon contaminated aqueous medium using crude oil as sole source of carbon. The growth parameters such as pH, temperature, and salinity were optimized for degradation of hydrocarbons and 92% degradation of crude oil removal was observed in 2weeks. The biosurfactant produced during the course of hydrocarbon degradation was monitored by surface tension and cell hydrophobicity measurements. The produced biosurfactant had the ability to decrease the surface tension of water from 72 to 28mN/m, with the critical micelle concentration (CMC) of 35mg/L. The biosurfactant exhibited 90% emulsification activity (EI) on crude oil. Nuclear magnetic resonance spectroscopy (NMR), X-ray diffraction (XRD), and thermal gravimetric (TG) analysis revealed the functional groups, surface nature and thermostability of the biosurfactant, respectively. Gas chromatography analysis demonstrated that the strain USTB efficiently degraded different alkanes from crude oil. The biosurfactant did not exhibit inhibitory effect to various vegetables, however strong antibiotic activity against gram positive and gram negative bacteria was observed. The study suggest application of the USTBa biosurfactant as an appropriate candidate for bioremediation of crude oil contaminants.