Low molecular weight peptides have been isolated by alkali extraction from deproteinized DNA of E. coli cells grown in the presence of radioactive glutamic acid or orthophosphate. The labeled peptides, purified by gel filtration chromatography on Sephadex G25 and G10, contain prevailingly glutamic acid, aspartic acid, glycine, serine and alanine. Electrophoretic studies at different pH show that some peptide fractions contain a phosphoric residue. The N-terminus of the phosphorylated peptides is apparently blocked and they were able to bind to DNA in the presence of Mg2+ ions. Moreover the acidic peptides extracted from E. coli DNA show a sharp activity in the control of lambda phage DNA transcription 'in vitro'.