In Escherichia coli uptake and catabolism of organophosphonates are governed by the phnCDEFGHIJKLMNOP operon. The phnO cistron is shown to encode aminoalkylphosphonate N-acetyltransferase, which utilizes acetylcoenzyme A as acetyl donor and aminomethylphosphonate, (S)- and (R)-1-aminoethylphosphonate, 2-aminoethyl- and 3-aminopropylphosphonate as acetyl acceptors. Aminomethylphosphonate, (S)-1-aminoethylphosphonate, 2-aminoethyl- and 3-aminopropylphosphonate are used as phosphate source by E. coli phn(+) strains. 2-Aminoethyl- or 3-aminopropylphosphonate but not aminomethylphosphonate or (S)-1-aminoethylphosphonate is used as phosphate source by phnO strains. Neither phn(+) nor phnO strains can use (R)-1-aminoethylphosphonate as phosphate source. Utilization of aminomethylphosphonate or (S)-1-aminoethylphosphonate requires the expression of phnO. In the absence of phnO-expression (S)-1-aminoethylphosphonate is bacteriocidal and rescue of phnO strains requires the simultaneous addition of d-alanine and phosphate. An intermediate of the carbon-phosphorus lyase pathway, 5'-phospho-α-d-ribosyl 1'-(2-N-acetamidoethylphosphonate), a substrate for carbon-phosphorus lyase, was found to accumulate in cultures of a phnP mutant strain. The data show that the physiological role of N-acetylation by phnO-specified aminoalkylphosphonate N-acetyltransferase is to detoxify (S)-1-aminoethylphosphonate, an analog of d-alanine, and to prepare (S)-1-aminoethylphosphonate and aminomethylphosphonate for utilization of the phosphorus-containing moiety.