The C gene of bacteriophage Mu, required for transcription of the phage late genes, was localized by construction and analysis of a series of deleted derivatives of pKN50, a plasmid containing a 9.4 kb Mu DNA fragment which complements Mu C amber mutant phages for growth. One such deleted derivative, pWM10, containing only 0.5 kb of Mu DNA, complements C amber phages and transactivates the mom gene, one of the Mu late genes dependent on C for activation. The DNA sequence of the 0.5 kb fragment predicts a single long open reading frame coding for a 140 amino acid protein. Sequence analysis of DNA containing a C amber mutation located the base change to the second codon of this reading frame. Generation of a frameshift mutation by filling in a BglII site spanning codon 114 of this reading frame resulted in the loss of C complementation and transactivation activity. These results indicate that this open reading frame encodes the Mu C gene product. Comparison of the predicted amino acid sequence of the C protein with those of other transcriptional regulatory proteins revealed some similarity to a region highly conserved among bacterial sigma factors.