The soluble, diffusible red-brown pigment produced by a Saccharopolyspora erythraea "red variant" has been shown to contain glycosylated and polymerized derivatives of 2,5,7-trihydroxy-1,4-naphthoquinone (flaviolin). Flaviolin is a spontaneous oxidation product of 1,3,6,8-tetrahydroxynaphthalene (THN), which is biosynthesized in bacteria by a chalcone synthase-like (CS-like) type III polyketide synthase (PKS). A fragment of the gene responsible for THN biosynthesis in S. erythraea E_8-7 was amplified by polymerase chain reaction (PCR) using degenerate primers based on conserved regions of known plant CS and bacterial CS-like genes. From the isolated fragment, a suicide vector was prepared, which was subsequently used to disrupt the red-brown pigment-producing (rpp) locus in S. erythraea, generating a mutant that displayed an albino phenotype. Chromosomal DNA from the albino mutant was subsequently used in a vector-recapture protocol to isolate a plasmid that contained an insert spanning the entire rpp locus. Sequencing of the insert revealed that the disrupted open reading frame (ORF) encodes a CS-like protein displaying 69% sequence identity to the rppA gene of Streptomyces griseus. The S. griseus rppA gene encodes RppA, the first characterized bacterial CS-like protein, which is sufficient in vitro for the synthesis of THN from malonyl-CoA. The rppA disruption mutant and rppA sequence provided a means by which to address the mechanism of diffusible pigment biosynthesis, as well as to investigate any link between this and the modulation of erythromycin A titre, which has been observed for S. erythraea variants.