The goal of this study was to investigate the microbiological characteristics of the ethanol-producing wild yeast, Aureobasidium pullulans P-1, isolated from flowers growing near the Yedang reservoir, Chungnam province, Korea, and in addition, to optimize its fermentation ability for the production of Makgeolli. A. pullulans P-1 was oval-shaped, and formed ascospores and pseudomycelium. The P-1 strain was a halophilic and sugar tolerant yeast which grew in 15% NaCl and 50% glucose-containing yeast extract-peptone-dextrose media. The P-1 strain was also resistant to 20% ethanol. Changes of the physicochemical properties during Makgeolli fermentation by A. pullulans P-1 were investigated. A maximum of 8.45% ethanol was obtained when a mixture of cooked rice, 150% water, and 35% ipguk per cooked rice was fermented by 5% A. pullulans P-1 culture broth at 25°C for 10 days. Antihypertensive angiotensin I-converting enzyme inhibitory activity in the Makgeolli ferment produced by A. pullulans P-1 reached a high of 71.1% after 10 days.