Workers in our laboratory have previously identified the staphylococcal respiratory response AB (SrrAB), a Staphylococcus aureus two-component system that acts in the global regulation of virulence factors. This system down-regulates production of agr RNAIII, protein A, and toxic shock syndrome toxin 1 (TSST-1), particularly under low-oxygen conditions. In this study we investigated the localization and membrane orientation of SrrA and SrrB, transcription of the srrAB operon, the DNA-binding properties of SrrA, and the effect of SrrAB expression on S. aureus virulence. We found that SrrA is localized to the S. aureus cytoplasm, while SrrB is localized to the membrane and is properly oriented to function as a histidine kinase. srrAB has one transcriptional start site which results in either an srrA transcript or a full-length srrAB transcript; srrB must be cotranscribed with srrA. Gel shift assays of the agr P2, agr P3, protein A (spa), TSST-1 (tst), and srr promoters revealed SrrA binding at each of these promoters. Analysis of SrrAB-overexpressing strains by using the rabbit model of bacterial endocarditis demonstrated that overexpression of SrrAB decreased the virulence of the organisms compared to the virulence of isogenic strains that do not overexpress SrrAB. We concluded that SrrAB is properly localized and oriented to function as a two-component system. Overexpression of SrrAB, which represses agr RNAIII, TSST-1, and protein A in vitro, decreases virulence in the rabbit endocarditis model. Repression of these virulence factors is likely due to a direct interaction between SrrA and the agr, tst, and spa promoters.