Natural Î²-carotene, an orangeâ€“red pigment of carotenoid family is widely used as food colorant. In this study microbial method of pigment production is adopted to encompass the other expensive technologies. Influence of substrate (rice powder) on Î²-carotenoid production has been extensively studied at optimum process conditions such as pH, temperature etc. A novel Î²-carotenoid producing pigment Bacillus clausii was isolated and identified by physiological tests as well as 16s rDNA sequence analysis. The maximum yield of Î²-carotenoid 48.9% using Bacillus clausii was achieved at pH 7 and 35oC utilizing rice powder as a sole substrate. A statistical design technique, Taguchi method was applied to evaluate the optimal process conditions such as pH, temperature etc. for maximum pigment production.