Recently, we found that Arthrobacter crystallopoietes N-08 isolated from soil directly produces trehalose from maltose by a resting cell reaction. In this study, the optimal set of conditions and substrate specificity for the trehalose production using resting cells was investigated. Optimum temperature and pH of the resting cell reaction were $55^{circ}C$ and pH 5.5, respectively, and the reaction was stable for two hours at $37{sim}55^{circ}C$ and for one hour at the wide pH ranges of 3~9. Various disaccharide substrates with different glycosidic linkages, such as maltose, isomaltose, cellobiose, nigerose, sophorose, and laminaribiose, were converted into trehalose-like spots in thin layer chromatography (TLC). These results indicated broad substrate specificity of this reaction and the possibility that cellobiose could be converted into other trehalose anomers such as ${alpha},{eta}$- and ${eta},{eta}$-trehalose. Therefore, the product after the resting cell reaction with cellobiose was purified by ${eta}$-glucosidase treatment and Dowex-1 ($OH^-$) column chromatography and its structure was analyzed. Component sugar and methylation analyses indicated that this cellobiose-conversion product was composed of only non-reducing terminal glucopyranoside. MALDI-TOF and ESI-MS/MS analyses suggested that this oligosaccharide contained a non-reducing disaccharide unit with a 1,1-glucosidic linkage. When this disaccharide was analyzed by $^1H$-NMR and $^{13}C$-NMR, it gave the same signals with ${alpha}$-D-glucopyranosyl-(1,1)-${alpha}$-D-glucopyranoside. These results suggest that cellobiose can be converted to ${alpha},{alpha}$-trehalose by the resting cells of A. crystallopoietes N-08.