Pseudomonas aeruginosa was recently found to possess a cluster of structural genes encoding phenylalanine hydroxylase (PhhA), carbinolamine dehydratase (PhhB), and aromatic aminotransferase (PhhC). We now report the presence, in the flanking upstream region, of a divergently transcribed gene (phhR) encoding an activator protein. Inactivation of phhR markedly reduced expression of the structural genes. PhhR belongs to the large prokaryote family of sigma 54 enhancer-binding proteins, and activation of the phh operon by PhhR in P. aeruginosa required rpoN. The closest homologues of PhhR are the TyrR proteins from Escherichia coli and Haemophilus influenzae. E. coli TyrR is an unusual member of the homologue family in that the transcriptional units regulated by tyrR are driven by sigma 70 promoters. P. aeruginosa phhR was able to replace E. coli tyrR as a repressor of the aroF-tyrA operon (but not as an activator of mtr) in the heterologous E. coli system. Two regions that resemble E. coli TyrR boxes were identified in the intervening region between phhR and phhA. We propose that one or both boxes may be the target of PhhR acting as an autogenous repressor at a sigma 70 promoter in one direction. In the other direction, one or both boxes may be the upstream activator sequence targeted by PhhR to facilitate expression of the phh operon from a sigma 54 promoter. The phh operon was strongly induced in fructose- or glucose-based minimal medium by L-phenylalanine. Inactivation of phhR in P. aeruginosa abolished ability to utilize either L-phenylalanine or L-tyrosine as a sole source of carbon for growth.