Transcription of the mal regulon of Escherichia coli K-12 is regulated by the positive activator, MalT. In the presence of ATP and maltotriose, MalT binds to decanucleotide MalT boxes that are found upstream of mal promoters and activates transcription at these sites. The earliest studies of the mal regulon, however, suggested a negative role for the MalK protein, the ATP-binding cassette subunit of the maltose transporter, in regulating mal gene expression. More recently, it was found that overexpression of the MalK protein resulted in very low levels of mal gene transcription. In this report we describe the use of tagged versions of MalT to provide evidence that it physically interacts with the MalK protein both in vitro and in vivo. In addition, we show that a novel malK mutation, malK941, results in an increased ability of MalK to down-modulate MalT activity in vivo. The fact that the MalK941 protein binds but does not hydrolyse ATP suggests that the MalK941 mutant protein mimics the inactive, ATP-bound form of the normal MalK protein. In contrast, cells with high levels of MalK ATPase show a reduced ability to down-modulate MalT and express several mal genes constitutively. These results are consistent with a model in which the inactive form of MalK down-modulates MalT and decreases transcription, whereas the active form of MalK does not. This model suggests that bacteria may be able to couple information about extracellular substrate availability to the transcriptional apparatus via the levels of ATP hydrolysis associated with transport.