Transcription of the hly operon of transmissible plasmids in Escherichia coli is subject to a tight regulation which also involves various chromosomal genes, such as hha. We have identified a 200-bp region within the hlyC gene, designated hlyM, which modulates hemolysin expression. The deletion of hlyM increased the activity of hly::galK fusion 20-fold. hlyM does not contain any internal promoter, nor is it capable of acting in trans. Our data suggest that the chromosomal Hha protein interacts with hlyM in order to silence the hly promoter. In addition, hlyR, a positive activator of hemolysin expression, seems to suppress the modulatory effect dictated by the Hha protein on the hlyM region.Synthesis and secretion of hemolysin are determined by the hly operon located either on the chromosome or on conjugative plasmids (10). Transcription of the hly operon produces a major 4-kb hlyCA transcript and a minor 8-kb hlyCABD transcript (31). The two transcripts initiate at the same promoter, located upstream of the hlyC gene (12, 31). The minor transcript is thought to be produced by readthrough, or antitermination, at a Rho-independent transcriptional terminator located between hlyA and hlyB (15). Similar patterns of expression have been reported for the leukotoxins of Pasteurella (27) and Actinobacillus (26) species.In the case of the plasmid hly operons, a 600-bp sequence (hlyR) located 1.5 kb upstream of hlyC is known to increase hemolysin expression (29). The primary mechanism by which hlyR exerts its action has been proposed to be antitermination at the hlyA-hlyB transcriptional terminator (15,16).Hemolysin expression is a rather complex process in which chromosomal genes are involved as well. Three of them, tolC (30), hha (9, 21), and more recently sfrB (1), have been identified. The hha gene was identified during analysis of hemolysin expression in cells harboring the hemolytic recombinant plasmid pANN202-312, which contains the cluster hlyCABD from