Arsenite oxidizing Klebsiella pneumoniae strain SSSW7 isolated from shipyard waste Goa, India showed a minimum inhibitory concentration of 21 mM in mineral salts medium. The strain possessed a small supercoiled plasmid and PCR amplification of arsenite oxidase gene (aioA) was observed on plasmid as well as chromosomal DNA. It was confirmed that arsenite oxidase enzyme was a periplasmic protein with a 47% increase in arsenite oxidase activity at 1 mM sodium arsenite. Scanning electron microscopy coupled with electron dispersive X-ray spectroscopic (SEM-EDS) analysis of 15 mM arsenite exposed cells revealed long chains of cells with no surface adsorption of arsenic. Transmission electron microscopy combined with electron dispersive X-ray spectroscopic (TEM-EDS) analysis demonstrated plasma membrane disruption, cytoplasmic condensation and periplasmic accumulation of arsenic. The bacterial strain oxidized 10 mM of highly toxic arsenite to less toxic arsenate after 24 h of incubation. Fourier transformed infrared (FTIR) spectroscopy confirmed the interaction of arsenite with functional groups present on the bacterial cell surface. Sodium dodecyl sulfate-polyacrylamide gel electrophoresis (SDS-PAGE) analysis of 5 mM arsenite exposed cells demonstrated over-expression of 87 kDa and 14 kDa proteins of two subunits aioA and aioB of heterodimer arsenite oxidase enzyme as compared to control cells. Therefore, this bacterial strain might be employed as a potential candidate for bioremediation of arsenite contaminated environmental sites.