The PKS genes for biosynthesis of the polyether nanchangmycin are organized to encode two sets of proteins (six and seven ORFs, respectively), but are separated by independent ORFs that encode an epimerase, epoxidase, and epoxide hydrolase, and, notably, an independent ACP. One of the PKS modules lacks a corresponding ACP. We propose that the process of oxidative cyclization to form the polyether structure occurs when the polyketide chain is still anchored on the independent ACP before release. 4-O-methyl-L-rhodinose biosynthesis and its transglycosylation involve four putative genes, and regulation of nanchangmycin biosynthesis seems to involve activation as well as repression. In-frame deletion of a KR6 domain generated the nanchangmycin aglycone with loss of 4-O-methyl-L-rhodinose and antibacterial activity, in agreement with the assignments of the PKS domains catalyzing specific biosynthetic steps.