Mobile genetic elements have the potential to influence the expression of genes surrounding their insertion site upon invasion of a genome. Here, we examine the transcriptional organization of a ribonucleotide reductase operon (nrd) that has been invaded by an HNH family homing endonuclease, mobE. In Aeromonas hydrophila phage Aeh1, mobE has inserted into the large-subunit gene (nrdA) of aerobic ribonucleotide reductase (RNR), splitting it into two smaller genes, nrdA-a and nrdA-b. This gene organization differs from that in phages T4, T6, RB2, RB3, RB15, and LZ7, where mobE is inserted in the nrdA-nrdB intergenic region. We present evidence that the expression of Aeh1 mobE is regulated by transcriptional, posttranscriptional, and translational controls. An Aeh1-specific late promoter drives expression of mobE, but strikingly the mobE transcript is processed internally at an RNase E-like site. We also identified a putative stem-loop structure upstream of mobE that sequesters the mobE ribosome binding site, presumably acting to down regulate MobE translation. Moreover, our transcriptional analyses indicate that the surrounding nrd genes of phage Aeh1 are expressed by a different strategy than are the corresponding phage T4 genes and that transcriptional readthrough is the only mechanism by which the promoterless Aeh1 nrdB gene is expressed. We suggest that the occurrence of multiple layers of control to limit the expression of mobE to late in the Aeh1 infection cycle is an adaptation of Aeh1 to reduce any effects on expression of the surrounding nrd genes early in phage infection when RNR function is critical.