The present study has been conducted towards isolation of moderately halophilic bacteria capable of transforming caffeine into theobromine. A total of 45 caffeine-degrading moderate halophiles were enriched from hypersaline lakes and examined for the biotransformation of caffeine to theobromine by thin-layer chromatography (TLC) and high-performance liquid chromatography analyses. Strain GL6, giving the highest yield of theobromine, was isolated from the Hoz Soltan Lake, 20 % w/v salinity, central Iran, and identified as Salinivibrio costicola based on morphological and biochemical features as well as its 16S rRNA gene sequence analysis (GeneBank Accession No. KT378066) and DNA–DNA relatedness. The biotransformation of caffeine with strain GL6 leads to the formation of two metabolites, identified as theobromine and paraxanthine, but the yield of paraxanthine was much lower. Further study on the production of theobromine from caffeine under resting cell experiment was carried out subsequently. The optimal yield of theobromine (56 %) was obtained after a 32-h incubation using 5 mM of caffeine and 15 g l−1 (wet weight) of biomass in 0.1 M saline phosphate buffer (pH 7.0 and 10 % w/v NaCl) under agitation 180 rpm at 30 °C. The biotransformed theobromine was purified by preparative TLC and subjected to FTIR and mass spectroscopy for chemical identification. This is the first evidence for biotransformation of caffeine into theobromine by strains of the genus Salinivibrio.