In this study, an enzyme-based electrochemical method was developed for the detection of Escherichia coli (E. coli) using the T7 bacteriophages engineered with lacZ operon encoding for beta-galactosidase (β-gal). The T7lacZ phages can infect E. coli, and have the ability to trigger the overexpression of β-gal during the infection of E. coli. The use of the engineered phages resulted in a more sensitive detection of E. coli by (1) overexpression of β-gal in E. coli during the specific infection and (2) release of the endogenous intracellular β-gal from E. coli following infection. The endogenous and phage-induced β-gal was detected using the electrochemical method with 4-aminophenyl-β-galactopyranoside (PAPG) as a substrate. The β-gal catalyzed PAPG to an electroactive species p-aminophenol (PAP) which could be monitored on an electrode. The electrochemical signal was proportional to the concentration of E. coli in the original sample. We demonstrated the application of our strategy in aqueous samples (drinking water, apple juice, and skim milk). Using this method, we were able to detect E. coli at the concentration of approximately 105 CFU/mL in these aqueous samples in 3 h and 102 CFU/mL after 7 h. This strategy has the potential to be extended to detect different bacteria using specific bacteriophages engineered with gene encoding for appropriate enzymes.