This paper formulates a theory for chemotactic pattern formation by the bacteria Escherichia coli in the presence of excreted attractant. In a chemotactically neutral background, through chemoattractant signaling, the bacteria organize into swarm rings and aggregates. The analysis invokes only those physical processes that are both justifiable by known biochemistry and necessary and sufficient for swarm ring migration and aggregate formation. Swarm rings migrate in the absence of an external chemoattractant gradient. The ring motion is caused by the depletion of a substrate that is necessary to produce attractant. Several scaling laws are proposed and are demonstrated to be consistent with experimental data. Aggregate formation corresponds to finite time singularities in which the bacterial density diverges at a point. Instabilities of swarm rings leading to aggregate formation occur via a mechanism similar to aggregate formation itself: when the mass density of the swarm ring exceeds a threshold, the ring collapses cylindrically and then destabilizes into aggregates. This sequence of events is demonstrated both in the theoretical model and in the experiments.