The traceless Staudinger ligation is an effective means to synthesize an amide bond between two groups of otherwise orthogonal reactivity: a phosphinothioester and an azide. An important application of the Staudinger ligation is in the ligation of peptides at a variety of residues. Here, we demonstrate that the traceless Staudinger ligation can be achieved in water with a water-soluble reagent. Those reagents that provide a high yield of amide product discourage protonation of the nitrogen in the key iminophosphorane intermediate. The most efficacious reagent, bis(p-dimethylaminoethyl)phosphinomethanethiol, mediates the rapid ligation of equimolar substrates in water. This reagent is also able to perform a transthioesterification reaction with the thioester intermediate formed during intein-mediated protein splicing. Hence, the traceless Staudinger ligation can be integrated with expressed protein ligation, extending the reach of modern protein chemistry.