Daptomycin is a lipopeptide antibiotic used clinically to treat infections caused by Gram-positive bacteria. Laboratory studies have shown that Staphylococcus aureus resistance to daptomycin occurs stepwise and slowly. Mutations associated with decreased susceptibility were mapped in mprF, yycG, rpoB, and rpoC, each giving about twofold increases in the minimal inhibitory concentration (MIC) and combinations giving higher MICs. The mprF gene encodes a dual functional enzyme that couples lysine to phosphatidylglycerol (PG) and transfers the lysyl-PG (LPG) to the outer leaflet of the membrane. LPG is less acidic than PG, and thus reduces the binding of Ca(++)-bound daptomycin to bacterial membranes. The mprF mutants have higher LPG/PG ratios in the membrane outer leaflet and bind less daptomycin than the wild-type strain. YycG is a sensor histidine kinase of a two component signal transduction system required for viability in many low G+C Gram-positive bacteria. The observation of DapR mutations in yycG suggests that YycG may be a target for daptomycin antibacterial activity. Daptomycin inserts into PG rich membrane at the cell division septum, but also inserts into lung surfactant, explaining why it failed to meet non-inferiority criteria in clinical trials for community acquired pneumonia (CAP). Recent advances in biosynthetic engineering have provided new tools to generate novel lipopeptides with modifications in the core peptide: several were very potent antibiotics against Gram-positive pathogens, and some were active in the presence of surfactant.