Many bacteria build elaborate molecular machines to import DNA via natural competence, yet this activity is often not identified until strains have been handled and domesticated in laboratory settings. For example, one of the best studied Gram-positive model organisms, Bacillus subtilis, has a non-transformable ancestor. Transformation in the ancestral strain is inhibited by a transmembrane peptide, ComI, which is encoded on an extrachromosomal plasmid. Although ComI was shown to be necessary and sufficient to inhibit transformation when produced at high levels under an inducible promoter, the mechanism by which ComI inhibits transformation is unknown. Here, we examine the native regulation and mechanism of transformation inhibition by ComI. We find that under native regulation, ComI expression is restricted in the absence of the plasmid. In the presence of the plasmid, we find that ComI is preferentially expressed in cells that are differentiating into a competent state. The subcellular localization of ComI, however, does not depend on any other competence proteins and permeabilization activity is concentration dependent. Thus over time, the competent cells gradually producing ComI, are permeabilized and killed. Based on these observations we propose a new model for the mechanism of ComI, suggesting a response to competence activation that selectively eliminates the competent subpopulation.