The vir-type IV secretion system of Agrobacterium is assembled from 12 proteins encoded by the virB operon and virD4. VirB1 is one of the least-studied proteins encoded by the virB operon. Its N terminus is a lytic transglycosylase. The C-terminal third of the protein, VirB1*, is cleaved from VirB1 and secreted to the outside of the bacterial cell, suggesting an additional function. We show that both nopaline and octopine strains produce abundant amounts of VirB1* and perform detailed studies on nopaline VirB1*. Both domains are required for wild-type virulence. We show here that the nopaline type VirB1* is essential for the formation of the T pilus, a subassembly of the vir-T4SS composed of processed and cyclized VirB2 (major subunit) and VirB5 (minor subunit). A nopaline virB1 deletion strain does not produce T pili. Complementation with full-length VirB1 or C-terminal VirB1*, but not the N-terminal lytic transglycosylase domain, restores T pili containing VirB2 and VirB5. T-pilus preparations also contain extracellular VirB1*. Protein-protein interactions between VirB1* and VirB2 and VirB5 were detected in the yeast two-hybrid assay. We propose that VirB1 is a bifunctional protein required for virT4SS assembly. The N-terminal lytic transglycosylase domain provides localized lysis of the peptidoglycan cell wall to allow insertion of the T4SS. The C-terminal VirB1* promotes T-pilus assembly through protein-protein interactions with T-pilus subunits.