β-d-Galactoside galactohydrolase (E.C. 3.2.1.23) was chemically modified with 1,1′-carbonyldiimidazole-activated polyethylene glycols (MW 2,000, 8,000, and 20,000). The modified β-galactosidases had over 50% of amino groups coupled to polyethylene glycol but retained over 50% of the original activity. The hydrophobically modified enzymes were soluble in chlorinated organic solvents in which transferase activity has been demonstrated. The transferase activity, its dependency on water content, and the thermostability of all three modified enzymes were compared. © 1990.