The srfA locus of BaciUlus subtilis is defined by a transposon Tn917 insertion and is required for productpon of the peptide secondary metabolite surfactin. The srfA locus was isolated by cloning the DNA flanking srfA::Tn917 insertions followed by chromosome walking. The cloned region is an operon of oyer 25 kb which covers the transcription initiation region but not the intact 3' end of srfA. csh-293, which was previously identified as a Tn9171ac mutation that impairs competence development and causes a condifoWl defect in sporulation, was known to be located in the vicinity of the srfA locus within the B. subtlis genome. The csh-293::Tn9171ac mutation was discovered to cause a defect in surfactin production and was shown to be located in the srfA operon by its cotransformation with srfA mutations and' by Southern hybridization analysis. Insertion mutations in srfA, created by the chromosomal integration of plasmids bearing overlapping srfA DNA fragments, were ex for their effects on surfactin production, competence, and sporulation. AB three processes were found to require the intact 5' half of the srfA operon, whereas the 3' half of srfA was found to be required for sporulation and surfactin production but not competence. These experiments show that srfA gene products function in B. subtilis cell specialization and differentiation.