Efficient biotransformation of lignin requires the activity of different oxidative enzymes. In this work, 19 bacterial multi-copper oxidases were screened for oxidase activity against 19 soluble substrates and revealed the highest activity in the laccase CotABsu (BSU0630) from Bacillus subtilis. Structure-based site-directed mutagenesis of CotABsu identified four conserved residues (His419, Cys492, His497, and Met502) as critical for activity against 2,2'-azinobis(3-ethylbenzthiazoline-6-sulfonate) (ABTS). Greatly reduced oxidase activity was found in the CotABsu mutant proteins E213A, N214A, C229A, N264A, E298A, T415A, R416A, Q468A, and T480A. We also designed a lignin-agarose plate screen for detecting oxidase activity of purified proteins against polymeric lignin, which confirmed the results obtained with ABTS and identified three mutant variants with increased activity toward kraft lignin (E213A, T415A, and T260A). X-ray photoelectron spectroscopy analysis of low sulfonate kraft lignin after incubation with CotABsu revealed a reduction in the content of CC/CC bonds and increase in CO/CO bonds. Product analyses using mass spectrometry, liquid chromatography, and bright-field microscopy revealed an increased polymerization state of reaction products suggesting that formation of radical intermediates was followed by radical coupling. Our results provide further insights into the mechanisms of lignin oxidation by laccases.