Streptothricins (STs) produced by Streptomyces strains are broad-spectrum antibiotics. All STs consist of a carbamoylated D-gulosamine to which the beta-lysine homopolymer (1 to 7 residues) and the amide form of the unusual amino acid streptolidine (streptolidine lactam) are attached. Although many ST-resistance genes have been identified in bacteria, including clinically isolated pathogens and ST-producing Streptomyces strains, only one resistance mechanism has been identified to date. This mechanism involves the modification of the ST molecule by monoacetylation of the moiety of the beta-lysine(s). In this study, we successfully isolated a novel ST-resistance gene (sttH) from Streptomyces albulus, which is a known ST nonproducer. The in vitro analysis of SttH demonstrated that this enzyme catalyzes the hydrolysis of the amide bond of streptolidine lactam, thereby conferring ST resistance. Interestingly, the selective toxicity of ST-D possessing 3x beta-lysine moiety was altered from broad-spectrum to bacteria-specific by the hydrolysis of streptolidine lactam, although ST-F (1 x beta-lysine) was detoxified by SttH in both prokaryotes and eukaryotes (yeasts). STs have not been clinically developed due to their toxicities; however, in this study, we showed that hydrolyzed ST-D (ST-D-acid) exhibits potent antibacterial activity even when its toxicity against eukaryotic cells is reduced by SttH. This suggests that ST-D-acid is a potential candidate for clinical development or for use as a new lead compound for drug discovery.