Rap phosphatases are a recently discovered family of protein aspartate phosphatases that dephosphorylate the Spo0F--P intermediate of the phosphorelay, thus preventing sporulation of Bacillus subtilis. They are regulators induced by physiological processes that are antithetical to sporulation. The RapA phosphatase is induced by the ComP-ComA two-component signal transduction system responsible for initiating competence. RapA phosphatase activity was found to be controlled by a small protein, PhrA, encoded on the same transcript as RapA. PhrA resembles secreted proteins and the evidence suggests that it is cleaved by signal peptidase I and a 19-residue C-terminal domain is secreted from the cell. The sporulation deficiency caused by the uncontrolled RapA activity of a phrA mutant can be complemented by synthetic peptides comprising the last six or more of the C-terminal residues of PhrA. Whether the peptide controls RapA activity directly or by regulating its synthesis remains to be determined. Complementation of the phrA mutant can also be obtained in mixed cultures with a wild-type strain, suggesting the peptide may serve as a means of communication between cells. Importation of the secreted peptide required the oligopeptide transport system. The sporulation deficiency of oligopeptide transport mutants can be suppressed by mutating the rapA and rapB genes or by introduction of a spo0F mutation Y13S that renders the protein insensitive to Rap phosphatases. The data indicate that the sporulation deficiency of oligopeptide transport mutants is due to their inability to import the peptides controlling Rap phosphatases.