The RNA polymerase core associated with σS transcribes many genes related to stress or to the stationary phase. When cells enter a phase of phosphate starvation, the transcription of several genes and operons, collectively known as the PHO regulon, is strongly induced. The promoters of the PHO genes hitherto analysed are recognized by σD-associated RNA polymerase. A mutation in the gene that encodes σS, rpoS, significantly increases the level of alkaline phosphatase activity and the overproduction of σ S inhibits it: Other PHO genes such as phoE and ugpB are likewise affected. by σS. In contrast, pstS, which encodes a periplasmic phosphate-binding protein and is a negative regulator of PHO, is stimulated by σS. The effect of σS on the PHO genes is at the transcriptional level. It is shown that a cytosine residue at position-13 is important for the positive effect of σS on pst. The interpretation of these observations is based on the competition between σ S and σD for the binding to the core RNA polymerase.