The accessory gene regulator (agr) quorum-sensing system is one of the major regulators of virulence factor production in the pathogen Staphylococcus aureus. Activation of the system depends on the production and sensing of a cyclic peptide signal called the autoinducing peptide (AIP). The biosynthesis of AIP depends on the coordinated action of the AgrB integral membrane endopeptidase and SpsB signal peptidase to process the peptide precursor AgrD into the final signal structure. The primary goal of this dissertation was to gain further insight on the role of AgrD and AgrB in the AIP biosynthesis mechanism. Studies in Chapter II were undertaken to better understand the role of AgrD domains in AgrB-mediated processing. A series of truncation and site-directed mutagenesis studies identified key residues in the AgrD C-terminus that were essential for AgrB processing and AIP production. In parallel, genetic manipulation of the N-terminal leader and AIP-encoding sequence revealed a role for these segments in AIP processing. For the first time, a complex of AgrD covalently linked to AgrB was identified, supporting proposals that this intermediate is an important precursor to AIP production. In Chapter III structure-function studies were performed on AgrB to gain further insight into the AIP biosynthetic mechanism. Initially, the agrBD genes were subjected to random mutagenesis and screened for deficiencies in AIP production. Single-site mutations at 20 different residues within AgrB and another 14 in AgrD were isolated. Interestingly, new mutations in the AgrD N-terminal leader were identified that affect AIP biosynthesis at different steps. In AgrB, most of the mutations blocked peptidase activity, but charge alterations to the K129-K131 region were defective in a later pathway step, separating the peptidase function from AIP ring formation and transport. To localize the AgrB mutations, we reevaluated the membrane topology using the substituted cysteine accessibility method. Our new model predicts four transmembrane helices and a reentrant loop, with both termini located outside of the cell. Finally, co-immunoprecipitation studies indicate that AgrB forms oligomeric structures within the membrane. Taken together, these findings provide a better understanding of the functional role of specific AgrD and AgrB regions in AIP biosynthesis.