The enzyme β-glucosidase mediates the rate limiting step of conversion of cellobiose to glucose and thus plays a vital role in the process of cellulose degradation. The present study deals with analysis of the effective novel strain of Paenibacillus lautus BHU3 for identifying high-efficiency thermostable, glucose tolerant β-glucosidases. Seven counterparts with elevated Tm values ranging from 64.6 to 75.8 °C with high thermo-stability, were revealed through this analysis. The blind molecular docking of the model enzymes structures with cellobiose and pNPG gave high negative interaction energies ranging from −11.33 to −13.29 and −6.43 to −9.054 (kcal mol−1), respectively. The enzyme WP_096774744.1 effectively formed 5 hydrogen bonds with the highest interaction energy (−13.29 kcal mol−1) with cellobiose at its catalytic site. Molecular dynamics simulation analysis performed for the WP_096774744.1-pNPG complex predicted Glu5, Arg7, Lue68, Gly69 and Phe325 as the major contributing residues for accomplishing hydrolysis of β-1-4-linkage. Further, the molecular docking of WP_096774744.1 enzyme with glucose revealed a distinct glucose-binding site distant from the substrate-binding site, thus confirming the deficient competitive inhibition by glucose. Hence, WP_096774744.1 β-glucosidase appears to be an efficient enzyme with enhanced activity to biodegrade the cellulosic materials and highly relevant for waste management and various industrial applications.