Fosfomycin is a clinically utilized, highly effective antibiotic, which is active against methicillin- and vancomycin-resistant pathogens. Here we report the cloning and characterization of a complete fosfomycin biosynthetic cluster from Streptomyces fradiae and heterologous production of fosfomycin in S. lividans. Sequence analysis coupled with gene deletion and disruption revealed that the minimal cluster consists of fom1-4, fomA-D. A LuxR-type activator that was apparently required for heterologous fosfomycin production was also discovered approximately 13 kb away from the cluster and was named fomR. The genes fomE and fomF, previously thought to be involved in fosfomycin biosynthesis, were shown not to be essential by gene disruption. This work provides new insights into fosfomycin biosynthesis and opens the door for fosfomycin overproduction and creation of new analogs via biomolecular pathway engineering.