Early in the process of spore formation in Bacillus subtilis a septum is formed that partitions the sporangium into daughter cells called the forespore and the mother cell. The daughter cells each have their own chromosome but follow dissimilar programs of gene expression. Differential gene expression in the forespore is now shown to be established by the compartmentalized activity of the transcription factor sigma F. The sigma F factor is produced prior to septation, but is active only in the forespore compartment of the post-septation sporangium. The sigma F factor is controlled by the products of sporulation operons spoIIA and spoIIE, which may be responsible for confining its activity to one of the daughter cells.