Single-copy gene fusions between the lacZ reporter gene and Escherichia coli strains containing promoters induced by cold shock (cspA), cytoplasmic stress (ibp), or protein misfolding in the cell envelope (P3rpoH) were constructed and tested to determine their ability to detect antibacterial agents while simultaneously providing information on their cellular targets. Antibiotics that affect prokaryotic ribosomes selectively induced the cspA::lacZ or ibp::lacZ gene fusion, depending on their mode of action. The membrane-damaging peptide polymyxin B induced both the P3rpoH::lacZ and ibp::lacZ fusions, while the β-lactam antibacterial agent carbenicillin activated only the P3rpoH promoter. Nalidixic acid, a compound that causes DNA damage, downregulated β-galactosidase synthesis from P3rpoH but had little effect on expression of the reporter enzyme from either the cspA or ibp promoter. All model antibiotics could be identified over a wide range of sublethal concentrations with signal-to-noise ratios between 2 and 11. A blue halo assay was developed to rapidly characterize the modes of action of antibacterial agents by visual inspection, and this assay was used to detect chloramphenicol secreted into the growth medium of Streptomyces venezuelae cultures. This simple system holds promise for screening natural or combinatorial libraries of antimicrobial compounds.