A cDNA of fatty acyl-acyl carrier protein (ACP) thioesterase (Fat) from developing seed of Madhuca butyracea has been cloned. The deduced amino acid sequence of the cDNA corresponding to the mature polypeptide showed 30-40% and 60-75% identity to the reported FatA and FatB class of plant thioesterases, respectively. This gene, MbFatB, is present as a single copy in M. butyracea genome and the MbFatB protein was detected clearly in seed tissues of this plant but not in that of Indian mustard (Brassica juncea). Heterologous expression of the MbFatB gene driven by different promoters in E. coli wild type and fatty acid beta-oxidation mutant (fadD88) strains resulted production of the recombinant protein with various fusion tags either as biologically inactive (insoluble) or functionally active forms. Expression of functionally active recombinant MbFatB in E. coli affected bacterial growth and cell morphology as well as changed the fatty acid profiles of the membrane lipid and the culture supernatant. Alteration of the fatty acid composition was directed predominantly towards palmitate and to a lesser extent myristate and oleate due to acyl chain termination activity of plant thioesterase in bacteria. Thus, this new MbFatB gene isolated from a non-traditional oil-seed tree can be used in future for transgenic development of oil-seed Brassica, a widely cultivated crop that expresses predominantly oleoyl-ACP thioesterase (FatA) in its seed tissue and has high amount of unwanted erucic acid in edible oil in order to alter the fatty acid profile in a desirable way.