Pseudomonas aeruginosa uses the alkylquinolones PQS (2-heptyl-3-hydroxy-4(1H)-quinolone) and HHQ (2-heptyl-4(1H)-quinolone) as quorum-sensing signal molecules, controlling the expression of many virulence genes as a function of cell population density. The biosynthesis of HHQ is generally accepted to require the pqsABCD gene products. We now reconstitute the biosynthetic pathway in vitro, and demonstrate that in addition to PqsABCD, PqsE has a role in HHQ synthesis. PqsE acts as thioesterase, hydrolyzing the biosynthetic intermediate 2-aminobenzoylacetyl-coenzyme A to form 2-aminobenzoylacetate, the precursor of HHQ and 2-aminoacetophenone. The role of PqsE can be taken over to some extent by the broad-specificity thioesterase TesB, explaining why the pqsE deletion mutant of P. aeruginosa still synthesizes HHQ. Interestingly, the pqsE mutant produces increased levels of 2,4-dihydroxyquinoline, resulting from intramolecular cyclization of 2-aminobenzoylacetyl-coenzyme A. Overall, our data suggest that PqsE promotes the efficiency of alkylquinolone signal molecule biosynthesis in P. aeruginosa and balances the levels of secondary metabolites deriving from the alkylquinolone biosynthetic pathway.