The biosynthesis of most secondary metabolites in different bacteria is strongly depressed by inorganic phosphate. The two-component phoR-phoP system of Streptomyces lividans has been cloned and characterized. PhoR showed all of the characteristics of the membrane-bound sensor proteins, whereas PhoP is a member of the DNA-binding OmpR family. Deletion mutants lacking phoP or phoR-phoP, were unable to grow in minimal medium at low phosphate concentration (10 microM). Growth was fully restored by complementation with the phoR-phoP genes. Both S. lividans DeltaphoP and DeltaphoR-phoP deletion mutants were unable to synthesize extracellular alkaline phosphatase (AP) as shown by immunodetection with anti-AP antibodies and by enzymatic analysis, suggesting that the PhoR-PhoP system is required for expression of the AP gene (phoA). Synthesis of AP was restored by complementation of the deletion mutants with phoR-phoP. The biosynthesis of two secondary metabolites, actinorhodin and undecylprodigiosin, was significantly increased in both solid and liquid medium in the DeltaphoP or DeltaphoR-phoP deletion mutants. Negative phosphate control of both secondary metabolites was restored by complementation with the phoR-phoP cluster. These results prove that expression of both phoA and genes implicated in the biosynthesis of secondary metabolites in S. lividans is regulated by a mechanism involving the two-component PhoR-PhoP system.