The sfp gene is required for cells of Bacillus subtilis to become producers of the lipopeptide antibiotic surfactin. sfp was isolated and its nucleotide sequence was determined. sfp was expressed in Escherichia coli and its putative product was purified for use in antibody production and in amino acid sequence analysis. The gene was plasmid-amplified in B. subtilis, where it conferred a Srf+ phenotype on sfp0 (surfactin non-producing) cells. Overproduction of Sfp in B. subtilis did not cause production of an increased amount of surfactin and resulted in the repression of a lacZ transcriptional fusion of the srfA operon, which encodes enzymes that catalyze surfactin synthesis. We propose that sfp represents an essential component of peptide synthesis systems and also plays a role, either directly or indirectly, in the regulation of surfactin biosynthesis gene expression.