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A cyanobacterium producing β-glucosidase was isolated from Lake Pamvotis located in Ioannina in Greece. This microorganism, named Pamv7, was identified as Pseudanabaena sp. using phylogenetic characterization. The high-throughput BiologMicroPlate™ method, used for the rapid assessment of heterotrophic potential, indicates that Pseudanabaena sp. metabolizes a wide range of organic substrates such as amino acids, carbohydrates, and carboxylic acids. When the strain grows in a culture medium containing cellobiose as a carbon source, it produces a significant amount of intracellular β-glucosidase. The effect of cellobiose concentration, nitrogen source, and nitrogen concentration of the growth medium, as well as the temperature of the culture, on biomass and β-glucosidase by Pseudanabaena sp., was studied. Biomass and β-glucosidase production by the strain in a lab-scale bioreactor at optimal conditions (10 g/L cellobiose, 1.5 g/L yeast, and 23 ± 1 °C) reached 2.8 g dry weight/L and 44 U/L, respectively. The protein and lipid content of the produced cyanobacterium biomass were 23% and 43 w/w, respectively. This study is the first report of β-glucosidase production by a cyanobacterial strain and concomitant high production of microalgae biomass, making Pseudanabaena sp. a promising microorganism in the field of enzyme biotechnology.