The present investigation highlights the optimal conditions for production of a non-toxic, bi-functional fibrinolytic enzyme xylarinase produced by endophytic fungus Xylaria curta by solid substrate fermentation using rice chaff medium. The purified enzyme is a monomeric protein with a molecular mass of ∼33 kDa. The enzyme exhibits cleavage of Aα and Bβ chains of fibrin(ogen) and has no effect on γ chain. The optimal fibrinolytic activity of the enzyme was observed at 35 °C and pH 8. The fibrinolytic activity was enhanced in the presence of Ca, whereas it was completely inhibited in the presence of Fe and Zn ions and inhibitors like EDTA and EGTA suggesting it to be a metalloprotease. The K and V of the enzyme for azocasein were 326 μM and 0.13 μM min. The N-terminal sequence of the enzyme (SNGPLPGGVVWAG) was same when compared to xylarinase isolated from culture broth of X. curta. Thus, xylarinase could be exploited as a potent clot busting enzyme which could be produced on large scale using solid substrate fermentation.