A new approach for in situ product removal from bioreactors is presented in which high-gradient magnetic separation is used. This separation process was used for the adsorptive removal of proteases secreted by Bacillus licheniformis. Small, non-porous bacitracin linked magnetic adsorbents were employed directly in the broth during the fermentation, followed by in situ magnetic separation. Proof of the concept was first demonstrated in shake flask culture, then scaled up and applied during a fed batch cultivation in a 3.7 L bioreactor. It could be demonstrated that growth of B. licheniformis was not influenced by the in situ product removal step. Protease production also remained the same after the separation step. Furthermore, degradation of the protease, which followed first order kinetics, was reduced by using the method. Using a theoretical modeling approach, we could show that protease yield in total was enhanced by using in situ magnetic separation. The process described here is a promising technique to improve overall yield in bio production processes which are often limited due to weak downstream operations. Potential limitations encountered during a bioprocess can be overcome such as product inhibition or degradation. We also discuss the key points where research is needed to implement in situ magnetic separation in industrial production.