We sequenced the complete genome of Bacillus cereus ATCC 10987, a non-lethal dairy isolate in the same genetic subgroup as Bacillus anthracis. Comparison of the chromosomes demonstrated that B.cereus ATCC 10987 was more similar to B.anthracis Ames than B.cereus ATCC 14579, while containing a number of unique metabolic capabilities such as urease and xylose utilization and lacking the ability to utilize nitrate and nitrite. Additionally, genetic mechanisms for variation of capsule carbohydrate and flagella surface structures were identified. Bacillus cereus ATCC 10987 contains a single large plasmid (pBc10987), of approximately 208 kb, that is similar in gene content and organization to B.anthracis pXO1 but is lacking the pathogenicity-associated island containing the anthrax lethal and edema toxin complex genes. The chromosomal similarity of B.cereus ATCC 10987 to B.anthracis Ames, as well as the fact that it contains a large pXO1-like plasmid, may make it a possible model for studying B.anthracis plasmid biology and regulatory cross-talk.