Multiple carbohydrate structures on the outer-membrane lipopolysaccharide (LPS) of the gram-negative pathogen H. influenzae undergo high frequency, reversible loss, indicative of phase variation. Characterization of a genetic locus, lic-1, responsible for expression of two LPS epitopes displaying phase variation, showed it to comprise four genes. The first gene mediates phase variation. At its 5' end, within the open reading frame, are a variable number of tandem repeats of the tetramer CAAT. By shifting upstream initiation codons in or out of frame, these 4 bp units create a translational switch. The phenotype of organisms corresponds to the number of 4 bp units. Phase variation between three levels of expression ( +, +, and -) of lic-1-derived epitopes is caused by differences in the three phases of translation of the 5' terminus of this gene. Phase variation also allows for selection of organisms displaying certain LPS epitopes in vivo.