The isolate DVL2 was isolated from common city garbage using the tributyrin as substrate. The isolate resulted in orange fluoresce under UV light on rohodamine olive oil agar plate detecting the lipase production. Three production media (PM1, PM2 and PM3) were evaluated for lipase/esterase production. In culture filterate (extracellular enzyme) and cell free extract i.e. extract after sonication of cells (intracellular enzyme), both lipase and esterase activity were detected. But esterase activity was found to be associated only with bacterial cells. The maximum intracellular (112 IU/L) and extracellular (33 IU/L) lipase production were obtained in Production medium 2 after 24 and 36 h respectively whereas the maximum production of esterase (extracellular, intracellular and membrane bound) was obtained in Production medium 2 after 24 h. The DVL2 lipase/esterase was found to esterify stearic acid with ethanol resulting in the formation of ethyl stearate which was confirmed by thin layer chromatography. Furthermore DVL2 lipase gave positive results when applied for resolution of chiral auxillary viz. 1-acetyl phenyl ethanol.