A novel β-glucosidase (BglPm) was identified from Paenibacillus mucilaginosus KCTC 3870(T) which has ginsenoside converting activity. The gene, termed bglPm, consists of 1,260 bp and belongs to glycoside hydrolase family 1 (GH1). After being overexpressed and purified from Escherichia coli, the enzymatic properties of BglPm were investigated. The enzyme exhibited an optimal activity at 45°C and pH 7.5 and showed high bioconversion ability for major ginsenoside Rb1 and Rd into ginsenoside F2. Thus, it was used for mass production of relatively high pure F2 from relatively abundant protopanaxadiol type ginsenosides mixture (PPDGM) with combined usage of ginsenoside Rc-hydrolyzing enzyme. Scale-up of production using 250 g of the PPDGM resulted in 152 g of F2 with 80.1% chromatography purity and 95.7% recovery. These results suggest that this enzyme would be useful in the preparation of pharmacologically active ginsenoside F2 in the functional food and pharmaceutical industries.