The promoter-proximal gene (glpT) of the glpT-glpQ operon of Escherichia coli encodes a membrane permease responsible for active transport of sn-glycerol 3-phosphate. Promoter-distal glpQ encodes a periplasmic protein which is not required for active transport of sn-glycerol 3-phosphate (Larson, T.J., Schumacher, G., and Boos, W. (1982) J. Bacteriol. 152, 1008-1021). This periplasmic protein has now been identified as a phosphodiesterase which hydrolyzes glycerophosphodiesters into sn-glycerol 3-phosphate plus alcohol. The enzyme exhibited broad substrate specificity with respect to the alcohol moiety; sn-glycerol 3-phosphate was released from glycerophosphoethanolamine, glycerophosphocholine, glycerophosphoglycerol, and bis(glycerophospho)glycerol. The enzyme was specific for glycerophosphodiesters; bis(p-nitrophenyl)phosphate, a substrate for other phosphodiesterases, was not hydrolyzed. In a coupled spectrophotometric assay utilizing sn-glycerol 3-phosphate dehydrogenase and NAD, apparent activity was optimal at pH 9 and was stimulated by Ca2+. The substrates of the phosphodiesterase had no affinity for the glpT-encoded active transport system. Thus, the glpQ gene product expands the catabolic capability of the glp regulon to include a variety of glycerophosphodiesters.