Acetylation of lysine residues is conserved in all three kingdoms; however, its role in prokaryotes is unknown. Here we demonstrate that acetylation enables the reference bacterium Escherichia coli to withstand environmental stress. Specifically, the bacterium reaches higher cell densities and becomes more resistant to heat and oxidative stress when its proteins are acetylated as shown by deletion of the gene encoding acetyltransferase YfiQ and the gene encoding deacetylase CobB as well as by overproducing YfiQ and CobB. Furthermore, we show that the increase in oxidative stress resistance with acetylation is due to the induction of catalase activity through enhanced katG expression. We also found that two-component system proteins CpxA, PhoP, UvrY, and BasR are associated with cell catalase activity and may be responsible as the connection between bacterial acetylation and the stress response. This is the first demonstration of a specific environmental role of acetylation in prokaryotes.