Extracts of the cephamycin C producer S. lactamdurans were found to possess cystathionine gamma-lyase activity (E.C. 4.4.1.1). This represents the first demonstration of this enzyme of the reverse transsulfuration pathway in a prokaryotic organism. A likely involvement of reverse transsulfuration in antibiotic synthesis is indicated by the fact that propargylglycine, a mechanism-based inhibitor of the gamma-lyase, is a strong inhibitor of cephamycin C production.