Initial analysis has shown that the transcription of the Pseudomonas alcaligenes lipA gene, which encodes an extracellular lipase, is governed by the LipQR two-component system consisting of sensor kinase LipQ and DNA-binding regulator LipR. This study further analyzes lipA gene expression and demonstrates that the RNA polymerase s54 is involved in the transcription. Purified LipR has an ATPase activity that is stimulated by the presence of lipA promoter DNA. Surface plasmon resonance measurements with purified and in vitro phosphorylated LipR reveal that phosphorylation of LipR is required for specific binding to the upstream activating sequence of the lipA promoter. Furthermore, mass spectrometric analysis combined with mutagenesis demonstrates that Asp52 is the phosphorylated aspartate. This analysis exposes LipR as a prominent member of the growing family of bacterial enhancer-binding proteins.