During signal transduction, response regulators of two-component systems are phosphorylated in a conserved receiver module. Phosphorylation induces activation of the non-conserved output domain. We fused various domains of the response regulators NtrC, PhoB or CheB to the DNA binding domain of lambda repressor. Analysis of these hybrid proteins shows that the receiver modules of NtrC and PhoB are potential dimerization domains. In the unphosphorylated proteins, the ability of the receiver modules to dimerize is masked due to inhibition by their output domains. Inhibition can be relieved in two ways: phosphorylation of the receiver module or deletion of the output domain. In contrast, the receiver module of CheB lacks this ability for dimerization. We propose a model which groups response regulators into two classes. Common to both classes is the interaction between receiver and output domain in the unphosphorylated protein. In class I (e.g. NtrC and PhoB), this interaction leads to the inhibition of the receiver module. Phosphorylation relieves inhibition, thereby inducing activation via dimerization of the receiver modules. In class II (e.g. CheB), the interaction between receiver and output domain results in inhibition of the output domain. Phosphorylation relieves inhibition, thereby activating the output domain.