The osmB gene, which encodes an outer membrane lipoprotein, can be induced by both osmotic and growth phase signals. Construction of two transcriptional fusions, an osmB-lacZ fusion in single copy on the bacterial chromosome and an osmB-cat fusion carried on a multicopy plasmid, demonstrated that induction of osmB by hyperosmolarity and during the stationary phase of growth occurred at the level of transcription. Two transcription initiation sites were identified by RNase protection of in vivo message. The downstream P2 promoter is the primary site for regulation; the basal level of expression is initiated at P2 and transcription from P2 is induced by elevated osmolarity or upon reaching stationary phase. Transcription from the P1 promoter, 150 base pairs (bp) upstream of the P2 promoter, occurred only when both osmotic and growth phase signals were present simultaneously; that is, when cells growing in high osmolarity medium have reached stationary phase. Deletion analysis narrowed the sequences necessary for P2 regulation to the 42-bp region upstream from the transcription start site. A 7-bp sequence just upstream from the -35 region was identified as a cis-acting regulatory element essential for osmotic stimulation of osmB expression. A hexanucleotide sequence within this segment could form the left arm of a region of dyad symmetry, flanking the -35 region of the promoter. Stationary phase induction at P2 does not require the 7-bp element.