The proteinaceous inhibitor of vertebrate lysozymes (Ivy) is produced by a collection of Gram-negative bacteria as a stress response to damage to their essential cell wall component peptidoglycan. A paralog of Ivy, Ivyp2 is produced exclusively by a number of pseudomonads, including Pseudomonas aeruginosa, but this protein does not inhibit the lysozymes, and its function was unknown. In this study, we demonstrate that the production of Ivy (homologs of both Ivyp1 and Ivyp2) correlates with bacteria that do not O-acetylate their peptidoglycan, a modification that controls the activity of the lytic transglycosylases. Furthermore, we show that both Ivy proteins are potent inhibitors of the lytic transglycoslyases, enzymes involved in the biosynthesis and maintenance of peptidoglycan. These data suggest that the true physiological function of the Ivy proteins is to control the autolytic activity of lytic transglycosylases within the periplasm of Gram-negative bacteria that do not produce O-acetylated peptidoglycan and that the inhibition of exogenous lysozyme by Ivy is simply a fortuitous coincidence.The cell envelope represents the only major structural element in bacterial cells, and it extends from the cytoplasmic leaflet of the plasma membrane to the outer layer(s) of wall and capsular polymers. Also, it constitutes an important functional compartment to organize essential metabolic processes, such as solute transport, protein translocation, and respiratory/photorespiratory energy generation. As a mesh-like cell wall heteropolymer that completely surrounds the cell, the peptidoglycan (PG) 4 sacculus confers strength, support, and shape to bacteria (all but the mycoplasmas), as well as resistance to internal turgor pressures (1). Consequently, maintaining the integrity of PG is essential to bacterial viability, which is reflected by the number of different classes of clinically important antibiotics that target its biosynthesis. The list of these include the glycopeptide vancomycin and the -lactams (penicillins, cephalosporins, and monobactams). The PG sacculus is also the target of the antibacterial enzyme lysozyme (EC 3.2.1.17; muramidase), which is present at high concentrations in animal secretions, including tears and saliva, as well as representing a major component of the innate immune system (reviewed in Ref.2).The PG sacculus is not a static structure, but rather it is continually expanded as cells grow. Its metabolism also involves its cleavage for the creation of both pores for secretion systems and sites for the insertion of flagella, in addition to the lysis of septa during cell division (3). A key class of endogenous enzymes responsible for PG lysis are the lytic transglycosylases (LTs) (4). The LTs cleave PG with the same specificity as the lysozyme, that is, the -1,4-glycosidic bond between MurNAc and GlcNAc residues (Fig. 1). However, unlike lysozyme, LTs are not hydrolases as they cleave PG with the concomitant formation of an intramolecular 1,6-anhydromuramoyl reaction product (5).The activit...