In Vibrio cholerae, 41 chitin-inducible genes, including the genes involved in natural competence for DNA uptake, are governed by the orphan two-component system (TCS) sensor kinase ChiS. However, the mechanism by which ChiS controls the expression of these genes is currently unknown. Here, we report the involvement of a novel transcription factor termed ‘TfoS’ in this process. TfoS is a transmembrane protein that contains a large periplasmic domain and a cytoplasmic AraC-type DNA-binding domain, but lacks TCS signature domains. Inactivation of tfoS abolished natural competence as well as transcription of the tfoR gene encoding a chitin-induced small RNA essential for competence gene expression. A TfoS fragment containing the DNA-binding domain specifically bound to and activated transcription from the tfoR promoter. Intracellular TfoS levels were unaffected by disruption of chiS and coexpression of TfoS and ChiS in Escherichia coli recovered transcription of the chromosomally integrated tfoR::lacZ gene, suggesting that TfoS is post-translationally modulated by ChiS during transcriptional activation; however, this regulation persisted when the canonical phosphorelay residues of ChiS were mutated. The results presented here suggest that ChiS operates a chitin-induced non-canonical signal transduction cascade through TfoS, leading to transcriptional activation of tfoR.