Engineering and design of genetic circuit in living cell is critical in accessing the beneficial application of synthetic biology. Directed evolution can avoid the complicated rational design of such circuit by screening or selecting functional circuit from non-functional one. Here, we proposed a positive-negative selection system for selecting a transcription factor that activates gene expression in response to arsenic in solution. First, we developed a whole cell biosensor for sensing arsenite in liquid using a regulator (ArsR) and a reporter (GFP), and evaluated its performance. Second, we developed a positive selection system for active ArsR using compartmentalized partnered replication that uses thermostable DNA polymerase as the reporter of activity. Third, we developed a negative selection system using sucrose-induced suicide gene SacB as the reporter for exclusion of inactive ArsR variants.