The simple circadian oscillator found in cyanobacteria can be reconstituted in vitro using three proteins-KaiA, KaiB, and KaiC. The total phosphorylation level of KaiC oscillates with a circadian period, but the mechanism underlying its sustained oscillation remains unclear. We have shown that four forms of KaiC differing in their phosphorylation state appear in an ordered pattern arising from the intrinsic autokinase and autophosphatase rates of KaiC and their modulation by KaiA. Kinetic and biochemical data indicate that one of these phosphoforms inhibits the activity of KaiA through interaction with KaiB, providing the crucial feedback that sustains oscillation. A mathematical model constrained by experimental data quantitatively reproduces the circadian period and the distinctive dynamics of the four phosphoforms.