Fusion of the lacZ gene coding for beta-galactosidase to the fadA,B and fadE operons was accomplished by using the phage Mu d (Apr lac). In such fusion strains, beta-galactosidase was induced by long-chain fatty acids and repressed by glucose, as is the normal pattern of control for the enzymes of the fad regulon. The level of induction seen was approximately 10-fold for both the fadA and fadE operons. These results demonstrate that the previously observed regulation of both the fadA and fadE operons is at the transcriptional level. When an insertion mutation in the fadR (repressor) gene was introduced into the fusion strains, beta-galactosidase was produced constitutively. A series of fatty acids of different chain lengths were tested as inducers. Acids of chain lengths of 10 carbon atoms or less failed to induce, those of 12 carbon atoms induced partly, and those of 14 or more carbon atoms induced fully. Imidazole was found to counteract the glucose repression of the fadA operon as recently demonstrated for the ara operon.