The spoOE locus of Bacillus subtilis codes for a negative regulator of sporulation that, when overproduced, represses sporulation and, if deleted, results in inappropriate timing of sporulation. The product of this locus, SpoOE, was purified and found to be a protein phosphatase, which specifically dephosphorylated the sporulation transcription factor SpoOA similar to P, converting it to an inactive form. SpoOE was not significantly active as a phosphatase on other components of the phosphorelay signal-transduction pathway producing SpoOA similar to P. A mutant SpoOE protein that results in sporulation deficiency was purified and found to be hyperactive as a phosphatase. The SpoOE phosphatase may provide an additional control point for environmental, metabolic, or cell-cycle regulation of phosphate flow in the phosphorelay. These results reinforce the concept that the phosphorelay is subject to a host of positive and negative signals for sporulation that are recognized and interpreted as a signal integration circuit that has the role of regulating the cellular level of active phosphorylated SpoOA sporulation transcription factor.