The expression of the divergently transcribed paaZ and paaABCDEFGHIJK catabolic operons, which are responsible for phenylacetic acid (PA) degradation in Escherichia coli, is driven by the Pz and Pa promoters, respectively. To study the transcriptional regulation of the inducible paa catabolic genes, genetic and biochemical approaches were used. Gel retardation assays showing that the PaaX regulator binds specifically to the Pa and Pz promoters were complemented with in vivo experiments that indicated a PaaX-mediated repression effect on the expression of Pa-lacZ and Pz-lacZ reporter fusions. The region within the Pa and Pz promoters that is protected by the PaaX repressor in DNase I footprinting assays contains a conserved 15-base pair imperfect palindromic sequence motif that was shown, through mutational analysis, to be indispensable for PaaX binding and repression. PA-coenzyme A (PA-CoA), but not PA, specifically inhibited binding of PaaX to the target sequences, thus confirming the first intermediate of the pathway as the true inducer and PaaX as the only bacterial regulatory protein described so far that responds to an aryl-CoA compound. Superimposed in the specific PaaX-mediated regulation is transcriptional activation by the cAMP receptor protein and the integration host factor protein. These global regulators may adjust the transcriptional output from Pa and Pz promoters to the overall growth status of the cell.