Purines can be used as the sole source of nitrogen by several strains of K. pneumoniae under aerobic conditions. The genes responsible for the assimilation of purine nitrogens are distributed in three separated clusters in the K. pneumoniae genome. Here, we characterize the cluster encompassing genes KPN_01787 to KPN_01791, which is involved in the conversion of allantoin into allantoate and in the deamination of guanine to xanthine. These genes are organized in three transcriptional units, hpxSAB, hpxC, and guaD. Gene hpxS encodes a regulatory protein of the GntR family that mediates regulation of this system by growth on allantoin. Proteins encoded by hpxB and guaD display allantoinase and guanine deaminase activity, respectively. In this cluster, hpxSAB is the most tightly regulated unit. This operon was activated by growth on allantoin as a nitrogen source; however, addition of allantoin to nitrogen excess cultures did not result in hpxSAB induction. Neither guaD nor hpxC was induced by allantoin. Expression of guaD is mainly regulated by nitrogen availability through the action of NtrC. Full induction of hpxSAB by allantoin requires both HpxS and NAC. HpxS may have a dual role, acting as a repressor in the absence of allantoin and as an activator in its presence. HpxS binds to tandem sites, S1 and S2, overlapping the ؊10 and ؊35 sequences of the hpxSAB promoter, respectively. The NAC binding site is located between S1 and S2 and partially overlaps S2. In the presence of allantoin, interplay between NAC and HpxS is proposed.