In the phage-plasmid P4, both lysogenic and lytic functions are coded by the same operon. Early after infection the whole operon is transcribed from the constitutive promoter PLE. In the lysogenic condition transcription from PLE terminates prematurely and only the immunity functions, which are proximal to the promoter, are thus expressed. Fragments of the P4 immunity region were cloned in an expression vector. A DNA fragment as short as 91 bp was sufficient, when transcribed, to express P4 immunity and to complement P4 immunity deficient mutants. This fragment, like prophage P4, produced a 69 nt long RNA (CI RNA). A shorter P4 fragment neither expressed immunity nor synthesized the CI RNA. Thus the CI RNA is the P4 trans-acting immunity factor. The 5' end of the CI RNA, mapped by primer extension, does not correspond to the transcription initiation point, thus suggesting that the CI RNA is produced by processing of the primary transcript. In an RNase P mutant host the processing of the 5' end and the production of a functional CI RNA were impaired. The requirement of RNase P for the correct processing of CI appears to be related to the predicted secondary structure of the precursor CI RNA. A region (seqB) within the CI RNA shows complementarity with two cis-acting sequences (seqA and seqC) required for P4 immunity, suggesting that transcription termination may be caused by pairing of the CI RNA with the complementary target sequences on the nascent transcript.