Clavulanic acid is a potent beta-lactamase inhibitor used to combat resistance to penicillin and cephalosporin antibiotics. There is a demand for high-yielding fermentation strains for industrial production of this valuable product. Clavulanic acid biosynthesis is initiated by the condensation of L-arginine and D-glyceraldehyde-3-phosphate (G3P). To overcome the limited G3P pool and improve clavulanic acid production, we genetically engineered the glycolytic pathway in Streptomyces clavuligerus. Two genes (gap1 and gap2) whose protein products are distinct glyceraldehyde-3-phosphate dehydrogenases (GAPDHs) were inactivated in S. clavuligerus by targeted gene disruption. A doubled production of clavulanic acid was consistently obtained when gap1 was disrupted, and reversed by complementation. Addition of arginine to the cultured mutant further improved clavulanic acid production giving a greater than 2-fold increase over wild type, suggesting that arginine became limiting for biosynthesis. This is the first reported application of genetic engineering to channel precursor flux to improve clavulanic acid production.