Penicillin-resistant strains of Streptococcus pneumoniae contain low affinity penicillin-binding proteins and often also produce abnormal indirectly crosslinked cell walls. However the relationship between cell wall abnormality and penicillin resistance has remained obscure. We now show that the genome of S. pneumoniae contains an operon composed of two genes ( murM and murN ) that encode enzymes involved with the biosynthesis of branched structured cell wall muropeptides. The sequences of murMN were compared in two strains: the penicillin-susceptible strain R36A producing the species-specific pneumococcal cell wall peptidoglycan in which branched stem peptides are rare, and the highly penicillin-resistant transformant strain Pen6, the cell wall of which is enriched for branched-structured stem peptides. The two strains carried different murM alleles: murM of the penicillin-resistant strain Pen6 had a “mosaic” structure encoding a protein that was only 86.5% identical to the product of murM identified in the isogenic penicillin-susceptible strain R36A. Mutants of R36A and Pen6 in which the murMN operon was interrupted by insertion-duplication mutagenesis produced peptidoglycan from which all branched muropeptide components were missing. The insertional mutant of Pen6 carried a pbp2x gene with the same “mosaic” sequence found in Pen6. On the other hand, inactivation of murMN in strain Pen6 and other resistant strains caused a virtually complete loss of penicillin resistance. Our observations indicate that the capacity to produce branched cell wall precursors plays a critical role in the expression of penicillin resistance in S. pneumoniae .