The synthesis of galacto-oligosaccharides (GOS) catalyzed by a novel commercial preparation of β-galactosidase from Bacillus circulans (Biolactase) was studied, and the products were characterized by MS and NMR. Using 400 g/L lactose and 1.5 enzyme units per milliliter, the maximum GOS yield, measured by HPAEC-PAD analysis, was 165 g/L (41% w/w of total carbohydrates in the mixture). The major transgalactosylation products were the trisaccharide Gal-β(1→4)-Gal-β(1→4)-Glc and the tetrasaccharide Gal-β(1→4)-Gal-β(1→4)-Gal-β(1→4)-Glc. The GOS yield increased to 198 g/L (49.4% w/w of total carbohydrates) using a higher enzyme concentration (15 U/mL), which minimized the enzyme inactivation under reaction conditions. Using skim milk (with a lactose concentration of 46 g/L), the enzyme also displayed transgalactosylation activity: maximum GOS yield accounted for 15.4% (7.1 g/L), which was obtained at 50% lactose conversion.