Arylomycins are type I signal peptidase inhibitors and have a potential as a new type of antibiotics. They were identified from the broth of Streptomyces sp. HCCB10043. The arylomycin biosynthetic gene cluster in this strain was identical to that in S. roseosporus. Within the gene cluster, aryC, encoding a P450 enzyme, was deduced to be responsible for biaryl bond formation in, the arylomycins. Inactivation of aryC abolished arylomycin production and led to the generation of two novel linear lipopentapeptides lacking the aryl-aryl linkage. These derivatives had lost their antibacterial activities against Staphylococcus epidermidis which is sensitive to arylomycins A2 and A4.