The present study was aimed at isolation and characterization of a new xylan degrading strain of Bacillus from soil for production of xylanase. Different soil samples from Punjab state were used to isolate xylan degrading strains. We isolated a highly active xylanolytic strain and performed genetic characterisation using 16S r-RNA analysis. DNA sequencing and phylogenetic analysis using MEGA4 software showed our strain to be a novel strain (accession number JQ916900) which was named Bacillus lpuarvinder st. lpu002. Biochemical characterization of the enzyme showed optimum activity at 60 oC and pH 8.6. The enzyme was stable at 70 oC for up to 6 hours. The xylanase activity seems to be alleviated by divalent Ca2+, Mn2+ and Mg2+ ions. The best enzyme activity was obtained when the cells were grown in Bushnell-Haas medium supplemented with 0.5% xylan and beef extract. The process optimization was done using solid state fermentation (SSF) using wheat straw as substrate. The enzyme isolated from SSF was analysed in a zymogram. The zymogram analysis showed prominent clear zone with congo red. The strain Bacillus lpuarvinder st. lpu002 produces a highly active xylanase, which may be taken to purification as it has immense biotechnological potential to be used in industries.