In the photosynthetic cyanobacterium Synechococcus sp. strain PCC 7942, the sphS and sphR genes were previously suggested to encode a typical pair of two-component signal transduction proteins. A deletion mutant strain lacking these genes failed to exhibit induction of alkaline phosphatase, the phoA gene product, in response to phosphate limitation in the medium. The SphR protein was overexpressed in Escherichia coli and then purified to near homogeneity. A truncated form of the SphS polypeptide (named SphS*) was also isolated. Here, we demonstrate that purified SphR is phosphorylated by phosphotransfer from SphS and binds to two distinct sites upstream from the phoA promoter. From these results, we conclude that the SphS and SphR proteins are directly involved in the regulation of phoA transcription in response to phosphate limitation in Synechococcus species.