The phn (psiD) gene cluster is induced during Pi limitation and is required for the use of phosphonates (Pn) as a phosphorus (P) source. Twelve independent Pn-negative (Pn-) mutants have lesions in the phn gene cluster which, as determined on the basis of recombination frequencies, is larger than 10 kbp. This distance formed the basis for determining the complete DNA sequence of a 15.6-kbp BamHI fragment, the sequences of which suggested an operon with 17 open reading frames, denoted (in alphabetical order) the phnA to phnQ genes (C.-M. Chen, Q.-Z. Ye, Z. Zhu, B. L. Wanner, and C. T. Walsh, J. Biol. Chem. 265:4461-4471, 1990) Ten Pn- lesions lie in the phnD, phnE, phnH, phnJ, phnK, phnO, and phnP genes. We propose a smaller gene cluster with 14 open reading frames, phnC to phnP, which probably encode transporter and regulatory functions, in addition to proteins needed in Pn biodegradation. On the basis of the effects on phosphite (Pt), Pi ester, and Pi use, we propose that PhnC, PhnD, and PhnE constitute a binding protein-dependent Pn transporter which also transports Pt, Pi esters, and Pi. We propose that PhnO has a regulatory role because a phnO lesion affects no biochemical function, except for those due to polarity. Presumably, the 10 other phn gene products mostly act in an enzyme complex needed for breaking the stable carbon-phosphorus bond. Interestingly, all Pn- mutations abolish the use not only of Pn but also of Pt, in which P is in the +3 oxidation state. Therefore, Pn metabolism and Pt metabolism are related, supporting a biochemical mechanism for carbon-phosphorus bond cleavage which involves redox chemistry at the P center. Furthermore, our discovery of Pi-regulated genes for the assimilation of reduced P suggests that a P redox cycle may be important in biology.