We have isolated and partially characterized a beta-phage mutant lysogen of Corynebacterium diphtheriae, C7(betatoxct1+), which is partially insensitive to iron inhibition of diphtheria toxin production. tox expression by C7(betatoxct1+) was found to be partially constitutive. In the presence of concentrations of iron that almost completely inhibit the expression of diphtheria toxin by the wild type, C7(beta), the level of toxin production by C7(betatoxct1+) was found to be at least 25 times that of the parent. The purified tox gene product of C7(betatoxct1+) was immunologically and electrophoretically identical to, and equally as toxic as, diphtheria toxin purified from C7(beta). In addition, the partial N-terminal amino acid sequence was found to be identical to diphtheria toxin. This data strongly suggests that the mutation allowing for the constitutive expression of tox in C7(betatoxct1+) is outside of the structural gene. Furthermore, the constitutive expression of diphtheria toxin was found to be cis dominant in the double lysogen C7(betacrm45+/betatoxct1+). The data presented is consistent with the existence of a tox operator locus.