The pWHM220 cosmid with a 24-kb insert cloned from Streptomyces albus ATCC 21838 induces the biosynthesis of a polyether antibiotic similar to salinomycin in Streptomyces invidans. We have analyzed this region by DNA sequencing as well as Southern blot hybridization with type I and type II polyketide synthase (PKS) probes. Surprisingly, we found another set of type II SKS genes only 10-kb from the original PKS genes, salABCDE. The DNA sequence revealed two complete open reading frames (ORFs) named salB2 and salC2, and one partial ORF that does not resemble any known DNA or deduced protein sequence. The salC2 should code for chain length determining factor while the deduced amino acid sequence encoded by salB2 exhibits high similarity to β-ketoacyl synthase from different PKS gene clusters. The highest identity was found for β-keetoacyl synthesis from S. argillaceus (MtmP. 59.1% identity), the mithramycin producer and from S. venezuelae ISP5230 (JadA, 52.3% identity), the jadomycin producer. The SalC2 protein clearly resembles its counterparts in order aromatic PKS gene clusters that are believed to influence the length of the polyketide chain. The highest identities observed were to that of S. argillaceus (MtmK, 62.3%) and S. venezuelae ISP 5230 (JadB, 55.1%) proteins, Moreover, the deduced amino acid sequences of the salB2 and salC2 products were 29.0% identical.