The present study reports a highly thermostable β-glucosidase (GH3) from Rasamsonia emersonii that was heterologously expressed in Pichia pastoris. Extracellular β-glucosidase was purified to homogeneity using single step affinity chromatography with molecular weight of ~ 110kDa. Intriguingly, the purified enzyme displayed high tolerance to inhibitors mainly acetic acid, formic acid, ferulic acid, vanillin and 5-hydroxymethyl furfural at concentrations exceeding those present in acid steam pretreated rice straw slurry used for hydrolysis and subsequent fermentation in 2G ethanol plants. Characteristics of purified β-glucosidase revealed the optimal activity at 80°C, pH5.0 and displayed high thermostability over broad range of temperature 50-70°C with maximum half-life of ~ 60h at 50°C, pH 5.0. The putative transglycosylation activity of β-glucosidase was appreciably enhanced in the presence of methanol as an acceptor. Using the transglycosylation ability of β-glucosidase, the generated low cost mixed glucose disaccharides resulted in the increased induction of R. emersonii cellulase under submerged fermentation. Scaling up the recombinant protein production at fermenter level using temporal feeding approach resulted in maximal β-glucosidase titres of 134,660units/L. Furthermore, a developed custom made enzyme cocktail consisting of cellulase from R. emersonii mutant M36 supplemented with recombinant β-glucosidase resulted in significantly enhanced hydrolysis of pretreated rice straw slurry from IOCL industries (India). Our results suggest multi-faceted β-glucosidase from R. emersonii can overcome obstacles mainly high cost associated enzyme production, inhibitors that impair the sugar yields and thermal inactivation of enzyme.