LAHORE: The soil of livestock farms in provincial metropolis is rich in fungi having potential to produce a particular enzyme, which is being used worldwide as a feed supplement in poultry industry. In a recent research carried out by Dr Ali Ahmad of University of Health Sciences (UHS) as part of his PhD research under the supervision of Prof Dr Aftab Ahmad Anjum, professor of Microbiology at University of Veterinary and Animal Sciences (UVAS), a particular type of fungi isolated from soil samples of livestock farms in city was qualitatively screened for phytase – an enzyme used in the feed for poultry production. Dr Ali Ahmad said that phosphorus was an important mineral for growth of animals and humans. Various cereals and grains contain phosphorus in organic form known as phytate. The ruminant animals such as cows produce phytase to hydrloyse the phytate and release inorganic phosphorus. Monogastric animals like poultry lack phytase in gastrointestinal tract to utilise phytate-phosphorus. These problems are solved by phytase supplementation in the feed. It decreases both anti-nutritive effects of phytate and feed cost by reducing the need for supplementation of inorganic phosphorus. The phytase is an environmentally friendly product, which reduces the amount of phosphorus excretion up to 50 % into environment and helps decrease phosphorus pollution in areas of intensive mono-gastric animal production. Thus phytase is an important enzyme for applications in food and feed industries. He added that phytase was being used as a feed supplement worldwide. It is an important enzyme for human and animal nutrition. The phytase is naturally present in microorganisms, plants and animal tissues. A large number of phytase producing bacteria and fungi have been isolated from a variety of environmental sources. The main fungal isolates belonging to the genera aspergillus, penicillium, mucor and thizopus produce phytase through submerged and solid-state fermentation. Microbial phytase produced in a cost effective manner has much better quality. In the study, selected phytase producing fungi were identified by morphological and molecular methods. Different physical and chemical parameters were optimised for growth of fungi and enzyme production. Enzyme production was determined by phytase assay. Proximate analysis of rice bran was carried out before and after fermentation. Fermented rice bran as enzyme source was fed to broiler chicks to determine its effect on broiler performance in comparison with commercial feed (control). The percentage of phytase producing fungal isolates was 10.76 %. The phytase producing fungi were identified as strains of aspergillus niger and aspergillus flavus. Physical and chemical conditions were optimised to increase the enzyme production by selected fungi. Fermentation improved the nutritional status of rice bran, increased percentage of crude protein, crude fat, ash and phosphorous and decrease the percentage of dry matter and crude fiber as compared to unfermented rice bran. Fermented rice bran can be used as phytase source and specialised feed ingredient in poultry feed to improve the growth performance of boiler chicks. It is a more suitable and cost effective method to replace existing feed supplementation practice with commercial phytase, which is expensive and increases the cost of poultry production. Two highest phytase producing fungi strains (A flavus PHY168 and A niger PHY82) can be used for commercial enzyme production. Poultry is 2nd largest industry in Pakistan and enzymes are imported for use as feed additive in poultry feed. It is costly and creates a burden on economy of country. Keeping in view the importance of phytase, present study on isolation and characterization of phytase producing fungi for poultry feed was conducted. Dr Ali Ahmad said that the native fungi would be used to produce phytase using cheaper agricultural by-products to meet enzyme demand of food and feed industries in Pakistan.