Regulation of the bacterial phage-shock-protein (Psp) system involves communication between integral (PspBC) and peripheral (PspA) cytoplasmic membrane proteins and a soluble transcriptional activator (PspF). In this study protein subcellular localization studies were used to distinguish between spatial models for this putative signal transduction pathway in Yersinia enterocolitica. In non-inducing conditions PspA and PspF were almost exclusively in the soluble fraction, consistent with them forming an inhibitory complex in the cytoplasm. However, upon induction PspA, but not PspF, mainly associated with the membrane fraction. This membrane association was dependent on PspBC but independent of increased PspA concentration. Analysis of psp null, overexpression and altered function mutants further supported a model where PspA is predominantly membrane associated only when the system is induced. Activation of the Psp system normally leads to a large increase in PspA concentration and we found that this provided a second mechanism for its membrane association, which did not require PspBC. These data suggest that basal PspFABC protein levels constitute a regulatory switch that moves some PspA to the membrane when an inducing trigger is encountered. Once this switch is activated PspA concentration increases, which might then allow it to directly contact the membrane for its physiological function.