Microbial cells [Micrococcus luteus] possessing high urease activity were entrapped in cellulose triacetate fibers, and their capability to hydrolyze urea was evaluated. The activity obtained using these fibers was dependent on the amount of cell entrapped; the best cells-to-carrier ratio was 1:10. Optimum pH and optimum temperature were 7.2 and 60.degree. C, respectively, for both the free cells and the immobilized cells, which suggests that the cells are physically bound to the polymer matrix. The effect of flow rate on the extent of conversion and continuous hydrolysis of urea was examined. A flow rate corresponding to a residence time of 1.325 h was satisfactory. The computed half-life of the system was 177.7 h. The potential industrial application is also discussed.