Comparative genomics analysis of conserved gene cassettes demonstrated resemblance between a recently described cassette of genes involved in sulphoquinovose degradation in Escherichia coli K-12 MG1655 and a Bacilli cassette linked with lactose degradation. Six genes from both cassettes had similar functions related to carbohydrate metabolism, namely, hydrolase, aldolase, kinase, isomerase, transporter, and transcription factor. The Escherichia coli sulphoglycolysis cassette was thus predicted to be associated with lactose degradation. This prediction was confirmed experimentally: expression of genes coding for aldolase (yihT), isomerase (yihS), and kinase (yihV) was dramatically increased during growth on lactose. These genes were previously shown to be activated during growth on sulphoquinovose, so our observation may indicate multi-functional capabilities of the respective proteins. Transcription starts for yihT, yihV and yihW were mapped in silico, in vitro and in vivo. Out of three promoters for yihT, one was active only during growth on lactose. We further showed that switches in yihT transcription are controlled by YihW, a DeoR-family transcription factor in the Escherichia coli cassette. YihW acted as a carbon source-dependent dual regulator involved in sustaining the baseline growth in the absence of lac-operon, with function either complementary, or opposite to a global regulator of carbohydrate metabolism, cAMP-CRP.