Abstract: An isolated DNA sequence that encodes a peptide with CPC-acetylhydrolase enzymatic activity is disclosed. Also, a method of expressing CPC-acetylhydrolase activity that includes the steps of (a) providing a microorganism that is susceptible to transformation with the isolated DNA sequence and that, upon transformation, expresses the CPC-acetylhydrolase activity encoded by the sequence, and (b) transforming the microorganism with the DNA sequence to cause expression of the CPC-acetylhydrolase activity in the microorganism is disclosed. Also, a method for producing a microorganism with increased capacity to aid in the production of cephalosporin, which method includes the steps of (a) providing a microorganism that has CPC-AH activity by virtue of expression of the DNA sequence or of a fragment thereof coding for the CPC-acetylhydrolase enzyme activity; and (b) inactivating the activity by disrupting expression of the DNA sequence is disclosed.