We took advantage of the vancomycin-dependent phenotype of Streptomyces coelicolor femX null mutants to isolate a collection of spontaneous, drug-independent femX suppressor mutants that expressed the vancomycin-resistance (van) genes constitutively. All of the suppressor mutations were in vanS but, unexpectedly, many were predicted to be loss-of-function mutations. Confirming this interpretation, a constructed vanS deletion mutation also resulted in constitutive expression of the van genes, suggesting that VanS negatively regulated VanR function in the absence of drug. In contrast, a vanS pta ackA triple mutant, which should not be able synthesize acetyl phosphate, failed to express the van genes, whereas a pta ackA double mutant showed wild-type, regulated induction of the van genes. These results suggest that in the absence of vancomycin, acetyl phosphate phosphorylates VanR, and VanS acts as a phosphatase to suppress the levels of VanR approximately P. On exposure to vancomycin, VanS activity switches from a phosphatase to a kinase and vancomycin resistance is induced. In S. coelicolor, the van genes are induced by both vancomycin and the glycopeptide A47934, whereas in Streptomyces toyocaensis (the A47934 producer) resistance is induced by A47934 but not by vancomycin. We exploited this distinction to replace the S. coelicolor vanRS genes with the vanRS genes from S. toyocaensis. The resulting strain acquired the inducer profile of S. toyocaensis, providing circumstantial evidence that the VanS effector ligand is the drug itself, and not an intermediate in cell wall biosynthesis that accumulates as result of drug action. Consistent with this suggestion, we found that non-glycopeptide inhibitors of the late steps in cell wall biosynthesis such as moenomycin A, bacitracin and ramoplanin were not inducers of the S. coelicolor VanRS system, in contrast to results obtained in enterococcal VanRS systems.