The kac gene coding for KSM acetyltransferase cloned from kasugamycin (KSM)-producing Streptomyces kasugaensis MB273-C4 (Hirasawa et al., 1993 ; JP. A-05-23187) was investigated for its correlation with KSM-productivity. Genomic Southern hybridization analysis indicated that kac existed in the genome of all the KSM-producing Streptomyces strains tested, i.e., S. kasugaensis MB273-C4 and M338-M1, and S. celluloflavus JCM4126 as well as Streptomyces sp. MF861-C4 that has characteristics taxonomically and phylogenically remote from those of the formers. We also found in experiments using Streptomyces sp. MF861-C4 that kac gene was readily deleted during storage as a lyophile with skim milk at 10°C or as a frozen 20% sucrose suspension at −20°C of its aerial mycelia, accompanying the loss of KSM productivity.