We have cloned and sequenced the 3-hydroxybutyrate dehydrogenase-encoding gene (bdhA) from Rhizobium (Sinorhizobium) meliloti. The gene has an open reading frame of 777 bp that encodes a polypeptide of 258 amino acid residues (molecular weight 27,177, pI 6.07). The R. meliloti Bdh protein exhibits features common to members of the short-chain alcohol dehydrogenase superfamily. bdhA is the first gene transcribed in an operon that also includes xdhA, encoding xanthine oxidase/dehydrogenase. Transcriptional start site analysis by primer extension identified two transcription starts. S1, a minor start site, was located 46 to 47 nucleotides upstream of the predicted ATG start codon, while S2, the major start site, was mapped 148 nucleotides from the start codon. Analysis of the sequence immediately upstream of either S1 or S2 failed to reveal the presence of any known consensus promoter sequences. Although a sigma54 consensus sequence was identified in the region between S1 and S2, a corresponding transcript was not detected, and a rpoN mutant of R. meliloti was able to utilize 3-hydroxybutyrate as a sole carbon source. The R. meliloti bdhA gene is able to confer upon Escherichia coli the ability to utilize 3-hydroxybutyrate as a sole carbon source. An R. meliloti bdhA mutant accumulates poly-3-hydroxybutyrate to the same extent as the wild type and shows no symbiotic defects. Studies with a strain carrying a lacZ transcriptional fusion to bdhA demonstrated that gene expression is growth phase associated.