The availability of nutrients is a major determinant for the timing of morphogenesis and antibiotic production in the soil-dwelling bacterium Streptomyces coelicolor. Here we show that N-acetylglucosamine transport, the first step of an important nutrient signalling cascade, is mediated by the NagE2 permease of the phosphotransferase system, and that the activity of this permease is linked to nutritional control of development and antibiotic production. The permease serves as a high-affinity transporter for N-acetylglucosamine (K(m) of 2.6 microM). The permease complex was reconstituted with individually purified components. This showed that uptake of N-acetylglucosamine requires a phosphoryl group transfer from phosphoenolpyruvate via the phosphotransferases EI, HPr and IIA(Crr) to NagF, which in turn phosphorylates N-acetylglucosamine during transport. Transcription of the nagF and nagE2 genes is induced by N-acetylglucosamine. Nutrient signalling by N-acetylglucosamine that triggers the onset of development was abolished in the nagE2 and nagF mutants. nagE2 is subject to multi-level control by the global transcription factor DasR and the activator AtrA that also stimulates genes for antibiotic actinorhodin biosynthesis. Hence, it is apparent that streptomycetes tightly control the nutritional state in a complex manner to ensure the correct timing for the developmental programme.