The gene cluster encoding the deoxyoleandolide polyketide synthase (OlePKS) was isolated from the oleandomycin producing strain Streptomnyces antibioticus. Sequencing of the first two genes encoding OlePKS, together with the previously identified third gene revealed an overall genetic and protein architecture similar to that of the erythromycin gene cluster encoding the 6-deoxyerythronolide B synthase (DEBS) from Saccharopolyspora erythraea. When the entire OlePKS (10,487 amino acids) was expressed in the heterologous host Streptomyces lividans, it produced 8,8a-deoxyoleandolide, an aglycone precursor of oleandomycin. The role of the P-450 monooxygenase, OleP, in oleandomycin biosynthesis was also examined in vivo by co-expression with DEBS in S. lividans. The production of 8,8a-dihydroxy-6-deoxyerythronolide B and other derivatives indicates that OleP is involved in the epoxidation pathway of oleandomycin biosynthesis. Since there are currently no genetic systems available for manipulation of the natural oleandomycin producing strain, the heterologous expression system reported here provides a useful tool for studying this important macrolide antibiotic.