The outer membrane of E. coil contains two major protein, OmpF and OmpC, which allow the passive diffusion of small hydrophilic molecules across the membrane. Expression of the genes coding for these proteins is affected in a reciprocal manner by the medium osmolarity. This osmoregulation is controlled at the transcriptional level by two protein factors, EnvZ and OmpR. The OmpR protein is the positive regulator specific for the ompF and ompC genes. The EnvZ protein was assumed to sense an environmental osmotic signal and then somehow modulate the OmpR function. The results of recent studies clearly imply that the phosphotransfer reactions between the EnvZ and OmpR proteins play roles in the signal transduction and the consequent osmoregulatory exression of the ompF and ompC genes in vivo. It was suspected that protein phosphorylation is commonly involved in the regulation of gene activation and signal transduction observed for a variety of prokaryotic two-component regulatory systems.