<jats:title>ABSTRACT</jats:title> <jats:p> A <jats:italic>Streptomyces clavuligerus ccaR</jats:italic> :: <jats:italic>aph</jats:italic> strain, which has a disruption in the regulatory gene <jats:italic>ccaR</jats:italic> , does not produce cephamycin C or clavulanic acid, but does produce a bioactive compound that was identified as holomycin by high-performance liquid chromatography (HPLC) and infrared and mass spectrometry. <jats:italic>S. clavuligerus</jats:italic> strains with disruptions in different genes of the clavulanic acid pathway fall into three groups with respect to holomycin biosynthesis. (i) Mutants with mutations in the early steps of the pathway blocked in the gene <jats:italic>ceaS</jats:italic> ( <jats:italic>pyc</jats:italic> ) (encoding carboxyethylarginine synthase), <jats:italic>bls</jats:italic> (encoding a β-lactam synthetase), or open reading frame 6 (ORF6; coding for an acetyltransferase of unknown function) are holomycin nonproducers. (ii) Mutants blocked in the regulatory gene <jats:italic>ccaR</jats:italic> or <jats:italic>claR</jats:italic> or blocked in the last gene of the pathway encoding clavulanic acid reductase ( <jats:italic>car</jats:italic> ) produce holomycin at higher levels than the wild-type strain. (iii) Mutants with disruption in <jats:italic>cyp</jats:italic> (coding for cytochrome P450), ORF12, and ORF15, genes that appear to be involved in the conversion of clavaminic acid into clavaldehyde or in secretion steps, produce up to 250-fold as much holomycin as the wild-type strain. An assay for holomycin synthetase was developed. This enzyme forms holomycin from holothin by using acetyl coenzyme A as an acetyl group donor. The holomycin synthase activities in the different clavulanic acid mutants correlate well with their production of holomycin.