The afsR gene encoding a regulatory protein and the afsK gene encoding a protein serine/threonine kinase constitute a protein phosphorylation system controlling secondary metabolism in Streptomyces coelicolor A3(2). The region between these two genes conferred the production of A-factor and the pigmented antibiotics actinorhodin and undecylprodigiosin on Streptomyces lividans, when it was carried on a high copy number plasmid. The nucleotide sequence between afsR and afsK revealed the presence of two small open reading frames named ORF-B of 176 amino acids and ORF-C of 63 amino acids. These ORFs showed no homology with proteins registered in the databases. ORF-B with the same orientation as AfsK contained three tandem repeats of Gly-Ser-Gly-Gly-Ser/Gly. ORF-C with the same orientation as AfsR contained three repeats of Thr-(X)2-Asp-Asn-His-Met-Pro-(X)2-Pro-Ala (X represents a nonconserved amino acid). Subcloning experiments showed that overexpression of ORF-C conferred pigment and A-factor production on S. lividans. The gene encoding ORF-C was therefore named afsS. It is thus apparent that afsS encoding a protein of 63 amino acids is involved in the regulation of secondary metabolism in S. coelicolor A3(2).