The filamentous phage coat protein pIII has been used to display a variety of peptides and proteins to allow easy screening for desirable binding properties. We have examined the biological constraints that restrict the expression of short peptides located in the early mature region of pIII, adjacent to the signal sequence cleavage site. Many functionally defective pIII fusion proteins contained several positively charged amino acids in this region. These residues appear to inhibit proper insertion of pIII into the Escherichia coli inner membrane, blocking the assembly and extrusion of phage particles. Suppressor mutations in the prlA (secY) component of the protein export apparatus dramatically alleviate the phage growth defect caused by the positively charged residues. We conclude that insertion of pIII fusion proteins into the inner membrane can occur by a sec gene-dependent mechanism. The suppressor strains should be useful for increasing the diversity of peptides displayed on pIII in phage libraries.