The primary sigma factor of Staphylococcus aureus, sigma(SA), regulates the transcription of many genes, including several essential genes, in this bacterium via specific recognition of exponential growth phase promoters. In this study, we report the existence of a novel staphylococcal phage G1-derived growth inhibitory polypeptide, referred to as G1ORF67, that interacts with sigma(SA) both in vivo and in vitro and regulates its activity. Delineation of the minimal domain of sigma(SA) that is required for its interaction with G1ORF67 as amino acids 294 to 360 near the carboxy terminus suggests that the G1 phage-encoded anti-sigma factor may occlude the -35 element recognition domain of sigma(SA). As would be predicted by this hypothesis, the G1ORF67 polypeptide abolished both RNA polymerase core-dependent binding of sigma(SA) to DNA and sigma(SA)-dependent transcription in vitro. While G1ORF67 profoundly inhibits transcription when expressed in S. aureus cells in mode of action studies, our finding that G1ORF67 was unable to inhibit transcription when expressed in Escherichia coli concurs with its inability to inhibit transcription by the E. coli holoenzyme in vitro. These features demonstrate the selectivity of G1ORF67 for S. aureus RNA polymerase. We predict that G1ORF67 is one of the central polypeptides in the phage G1 strategy to appropriate host RNA polymerase and redirect it to phage reproduction.