The FadR protein of E. coli activates transcription of the fabA gene, a key enzyme of fatty acid synthesis. We report that FadR binds to a DNA sequence positioned at -40 relative to the start site of the FadR-regulated fabA transcript (the location favored by positive activators). This binding was found to be specifically antagonized by long chain acyl-CoAs. The chain length specificity of the disassociation of the FadR-DNA complex by acyl-CoAs observed in vitro reflects that seen in the repression of fabA transcription observed upon addition of fatty acids to bacterial cultures. Acyl-CoA antagonism of FadR-DNA interactions is readily reversible. These data indicate that repression of fabA transcription by fatty acids is the first reported example of a repression system mediated by positive control.