Two genes, aphE and orf, coding for putative Mr 29,000 and Mr 31,000, proteins respectively, were identified in the nucleotide sequence of a 2.8 kbp DNA segment cloned from Streptomyces griseus N2-3-11. The aphE gene expressed streptomycin (SM) resistance and a SM phosphorylating enzyme in S. lividans strains. The two genes were found to be in opposite direction and seemed to share a common region of transcription termination. The aphE gene shows significant homology to the aph gene, encoding aminoglycoside 3'-phosphotransferase, APH(3'), from the neomycin-producing S. fradiae. The enzymatic specificity of the aphE gene product was identified to be SM 3"-phosphotransferase, APH(3"). The primary structure of the APH(3") protein is closely related to the members of the APH(3') family of enzymes. However, the APH(3") enzyme did not detectably phosphorylate neomycin or kanamycin. There is only low similarity of the protein to the APH(6) group of SM phosphotransferases. An evolutionary relationship between antibiotic and protein kinases is proposed.