A type III polyketide biosynthetic gene cluster has been discovered in the industrially important strain Streptomyces toxytricini NRRL 15443, including four genes stp450-1, stts, stp450-2, and stmo. The stts gene encodes a putative type III polyketide synthase that is homologous to RppA, a 1,3,6,8-tetrahydroxynaphthalene (THN) synthase from Streptomyces griseus. The deduced protein product of stmo resembles the cupin-containing monooxygenase MomA from Streptomyces antibioticus that oxidizes THN into flaviolin. Two cytochrome P450s (CYPs), StP450-1 and StP450-2, are present in the gene cluster. StTS was overexpressed in Escherichia coli BL21(DE3) and identified as a THN synthase. The synthesized THN can be easily oxidized into flaviolin by air. Both CYPs were reconstituted in E. coli BL21(DE3) and can oxidize flaviolin to form oligomers. The k (cat)/K (m) values for StP450-1 and StP450-2 were 0.28 and 0.71 min(-1) mM(-1), respectively. UV irradiation test showed that expression of StTS in E. coli BL21(DE3) significantly protects the cells from UV radiation, and coexpression of StTS and StP450-1 provides even stronger protection.