A novel glyA gene was screened from a marine bacterium, Idiomarina loihiensis encoding a thermo-stable serine hydroxymethyl transferase (SHMT; 418 AA; 45.4 kDa). The activities of wild type (WT) and mutants were analyzed against d-phenylserine using pyrodoxal-5-phosphate (PLP) as cofactor under optimized conditions. Based on homology modelling and molecular docking, several residues were found that may be able to improve the activity of WT-SHMT. Site directed mutagenesis was conducted. The activity and thermostability of the wild type SHMT was improved by two variants H61G and G132P, which showed a noteworthy change in the thermo-stability and activity as compared to WT. To investigate the mechanism of activity of mutants, we combined two residues into one mutant DUAL. WT showed the optimum activity at 50 °C, whereas H61G, G132P and DUAL had the temperature optima of 55, 60 and 60 °C, respectively. These mutants G132P, H61G and DUAL were quite stable at 45 and 55 °C as compared to WT. Dual mutant was relatively more stable at all tested pH(s) while WT loses its activity in alkaline pH(s). Kinetics studies indicated the 1.52, 2.42 and 4.54 folds increase in the kcat value of H61G, G132P and Dual mutants as compared to WT respectively. The molecular docking indicated that hydrophobic interactions are more prominent than hydrogen-bonding and had more influence on ligand binding and active site cavity. The molecular dynamics showed the changed RMSD values for ligand and formation of new hydrogen bonds, hydrophobic interaction which considerably increased the activity and thermo-stability of the mutant proteins as compared to WT. Thus, increased stabilities at higher temperatures and activities can be attributed to new hydrogen bonding, altered active site geometry and increased ligand interactions.