Two contrasting cyanobacterial species (Anabaena fertilissima and Anabaena sphaerica) were selected based on differences in antifungal behavior in order to study the mechanism for production of an antifungal enzyme and the genes responsible for this production. In A. fertilissima, chitosanase and antifungal activities were increased significantly under of growth-limiting conditions (8 of light and 16 h of darkness). The lack of such activities in A. sphaerica was associated with high levels of protein that accumulated during the stationary phase (at 28 days) under the same light conditions. The gene putatively responsible for chitosanase and antifungal activities was amplified using specific primers, and sequence analysis of the amplified products (1.086 and 1.101 kb in A. sphaerica and A. fertilissima, respectively) showed that they belong to the glycoside hydrolase 3 (GH3)-like family of Anabaena variabilis ATCC 29413. Pairwise alignment of the corresponding protein sequences identified a putative signal peptide (amino acids 1 to 23) and some amino acid changes in the sequence of A. fertilissima which may be responsible for functioning of the chitosanase and the observed antifungal activity. Hydrolysis of the chitosan oligosaccharide (GlcN)₅ to (GlcN)₂ and (GlcN)₃ confirmed the presence of chitosanase activity in A. fertilissima. Site-directed mutagenesis of the A. fertilissima chitosanase-encoding gene (cho) led to identification of catalytic residues (Glu-121 and Glu-141) important for the antifungal effect of the cho product. The level of expression of cho was monitored by quantitative real-time reverse transcription-PCR, which indicated that transcription of this gene is significantly enhanced under conditions that retard growth, such as a long dark period.