The Streptococcus pyogenes transcriptional regulator Rgg controls the expression of virulence-associated genes encoded both within the core genome and within horizontally transmissible DNA such as temperate bacteriophage. Previously, we showed that Rgg binds to the non-coding DNA upstream of the bacteriophage gene encoding an extracellular DNase Spd-3. In the current study, we further characterized Rgg-mediated regulation of spd-3 expression. Two spd-3 transcripts were identified by northern blotting. The 5' ends were 27 and 594 nucleotides upstream of the start codon as determined with primer extension analysis and 5' RACE (rapid amplification of c-DNA ends), respectively. Results obtained with gel shift assays showed that purified Rgg bound specifically to non-coding DNA containing the promoters of both transcripts. Transcriptional fusion analyses confirmed the presence of Rgg-repressible promoters within these DNA regions. In addition, repression was associated with direct DNA binding by Rgg as determined with chromatin immunoprecipitation (ChIP) coupled with quantitative PCR (qPCR). The results show that the chromosomally encoded transcriptional regulator, Rgg, directly represses both bacteriophage promoters controlling the expression of Spd-3. The results provide new information regarding the regulation of prophage encoded virulence factors of S. pyogenes and highlight the complex evolutionary history of S. pyogenes and temperate bacteriophage.