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Abstract σ factors are considered as positive regulators of gene expression. Here we reveal the opposite, inhibitory role of these proteins. We used a combination of molecular biology methods and computational modeling to analyze the regulatory activity of the extracytoplasmic σE factor from Streptomyces coelicolor. The direct activator/repressor function of σE was then explored by experimental analysis of selected promoter regions in vivo. Additionally, the σE interactome was defined. Taken together, the results characterize σE, its regulation, regulon, and suggest its direct inhibitory function (as a repressor) in gene expression, a phenomenon that may be common also to other σ factors and organisms.