Mechanisms of mutagenesis activated by stress responses drive pathogen/host adaptation, antibiotic and anti-fungal-drug resistance, and perhaps much of evolution generally. In Escherichia coli, repair of double-strand breaks (DSBs) by homologous recombination is high fidelity in unstressed cells, but switches to a mutagenic mode using error-prone DNA polymerases when the both the SOS and general (σS) stress responses are activated. Additionally, the σE response promotes spontaneous DNA breakage that leads to mutagenic break repair (MBR). We identified the regulatory protein PhoU in a genetic screen for functions required for MBR. PhoU negatively regulates the phosphate-transport and utilization (Pho) regulon when phosphate is in excess, including the PstB and PstC subunits of the phosphate-specific ABC transporter PstSCAB. Here, we characterize the PhoU mutation-promoting role. First, some mutations that affect phosphate transport and Pho transcriptional regulation decrease mutagenesis. Second, the mutagenesis and regulon-expression phenotypes do not correspond, revealing an apparent new function(s) for PhoU. Third, the PhoU mutagenic role is not via activation of the σS, SOS or σE responses, because mutations (or DSBs) that restore mutagenesis to cells defective in these stress responses do not restore mutagenesis to phoU cells. Fourth, the mutagenesis defect in phoU-mutant cells is partially restored by deletion of arcA, a gene normally repressed by PhoU, implying that a gene(s) repressed by ArcA promotes mutagenic break repair. The data show a new role for PhoU in regulation, and a new regulatory branch of the stress-response signaling web that activates mutagenic break repair in E. coli.