To provide Japanese paper yarn capable of producing a woven or knitted fabric having a feeling and a function different from those of a fabric of an existing natural fiber, when formed into the fabric, by acting a cellulase-based enzyme, including a variant species of the cellulase enzyme, which effectively acts on a cellulosic material on surfaces of the Japanese paper yarn under a specified processing condition, and to provide a method for processing the woven or knitted fabric.

This Japanese paper yarn is treated by solely using the cellulase-based enzyme, or by using a mixture formed by mixing the enzyme with the variant species thereof in a suitable ratio, at 40-70°C and a pH of 4.0-6.5 for 15-40 min in a medium comprising water, when denier reduction of cellulose on the surfaces of the Japanese paper yarn is conducted. A choice in conducting the denier reduction between a treatment in which the Japanese paper yarn is enough subjected to the denier reduction and then the woven or knitted fabric is directly resulted from the yarn and another treatment in which the Japanese paper yarn is treated in such a restricted level as not to cause troubles in a knitting machine nor in a weaving machine and then the knitted fabric or the woven fabric is repeatedly subjected to the denier reduction after woven or knitted is dealt with according to a kind of the woven or knitted fabric.