Cultures of the inducible penicillinase-producing strain 749 of Bacillus licheniformis, induced with small amounts of benzylpenicillin, synthesized penicillinase at a high rate for a short period, after which the rate of synthesis slowly declined. During the period of active synthesis, the rate of secretion, as a fraction of the level of cell-bound penicillinase (which is originally high), gradually decreased to a constant level. Chloramphenicol, at a concentration (40 mug/ml) which completely inhibited synthesis of penicillinase, partially inhibited secretion if added during the period of active synthesis. During the phase of reduced synthesis, chloramphenicol was without effect on secretion. Penicillinase secretion, by actively growing cultures of the constitutive penicillinase-producing mutant 749/C, was inhibited by 75% immediately after addition of chloramphenicol. The secretion of part of the penicillinase released during active growth is probably dependent on synthesis of penicillinase, but part of the secreted penicillinase can be released in the absence of synthesis. Protoplasts were obtained from which periplasmic penicillinase has been removed, and these protoplasts were capable of substantial growth and penicillinase synthesis without lysis. At pH 7.5, there was no net incorporation of penicillinase into the cell membrane; the enzyme released was almost entirely of the exo form and was roughly equivalent to the amount of new enzyme formed. At pH 6.0, there was some incorporation of penicillinase into the plasma membrane, and approximately half of the extracellular penicillinase was in the exo form; the remainder perhaps represented membrane fragments. In the presence of chloramphenicol, a small amount of penicillinase was released at pH 7.5 as the exo form; at pH 6.0, practically none was released. We suggest that, with the removal from protoplasts of the periplasmic penicillinase-containing particles, a restriction on secretion has been lifted.