The differentiating bacterium Streptomyces coelicolor harbours some 66 sigma factors, which support its complex life cycle. σB, a functional homologue of σS from Escherichia coli, controls both osmoprotection and differentiation in S. coelicolor A3(2). Microarray analysis revealed σB-dependent induction of more than 280 genes by 0.2 M KCl. These genes encode several sigma factors, oxidative defence proteins, chaperones, systems to provide osmolytes, cysteine, mycothiol, and gas vesicle. σB controlled induction of itself and its two paralogues (σL and σM) in a hierarchical order of σB→σL→σM, as revealed by S1 mapping and Western blot analyses. The phenotype of each sigma mutant suggested a sequential action in morphological differentiation; σB in forming aerial mycelium, σL in forming spores and σM for efficient sporulation. σB was also responsible for the increase in cysteine and mycothiol, the major thiol buffer in actinomycetes, upon osmotic shock, revealing an overlap between protections against osmotic and oxidative stresses. Proteins in sigB mutant were more oxidized (carbonylated) than the wild type. These results support a hypothesis that σB serves as a master regulator that triggers other related sigma factors in a cascade, and thus regulates differentiation and osmotic and oxidative response in S. coelicolor.