Group A streptococcus (GAS) is an important human pathogen that causes pharyngitis and invasive infections, including necrotizing fasciitis. Streptolysin S (SLS) is the cytolytic factor that creates the zone of beta-hemolysis surrounding GAS colonies grown on blood agar. We recently reported the discovery of a potential genetic determinant involved in SLS production, sagA, encoding a small peptide of 53 amino acids (S. D. Betschel, S. M. Borgia, N. L. Barg, D. E. Low, and J. C. De Azavedo, Infect. Immun. 66:1671–1679, 1998). Using transposon mutagenesis, chromosomal walking steps, and data from the GAS genome sequencing project (www.genome.ou.edu/strep.html ), we have now identified a contiguous nine-gene locus (sagA to sagI) involved in SLS production. The sag locus is conserved among GAS strains regardless of M protein type. Targeted plasmid integrational mutagenesis of each gene in the sag operon resulted in an SLS-negative phenotype. Targeted integrations (i) upstream of the sagA promoter and (ii) downstream of a terminator sequence after sagI did not affect SLS production, establishing the functional boundaries of the operon. A rho-independent terminator sequence between sagA andsagB appears to regulate the amount of sagAtranscript produced versus transcript for the entire operon. Reintroduction of the nine-gene sag locus on a plasmid vector restored SLS activity to the nonhemolytic sagAknockout mutant. Finally, heterologous expression of the intactsag operon conferred the SLS beta-hemolytic phenotype to the nonhemolytic Lactococcus lactis. We conclude that gene products of the GAS sag operon are both necessary and sufficient for SLS production. Sequence homologies of sagoperon gene products suggest that SLS is related to the bacteriocin family of microbial toxins.