DjlA is a 30-kDa type III membrane protein of Escherichia coli with the majority, including an extreme C-terminal putative J-domain, oriented toward the cytoplasm. No other regions of sequence similarity aside from the J-domain exist between DjlA and the known DnaK (Hsp70) co-chaperones DnaJ (Hsp40) and CbpA. In this study, we explored whether and to what extent DjlA possesses DnaK co-chaperone activity and under what conditions a DjlA-DnaK interaction could be important to the cell. We found that the DjlA J-domain can substitute fully for the J-domain of DnaJ using various in vivo functional complementation assays. In addition, the purified cytoplasmic fragment of DjlA was shown to be capable of stimulating DnaK ATPase in a manner indistinguishable from DnaJ, and, furthermore, DjlA could act as a DnaK co-chaperone in the reactivation of chemically denatured luciferase in vitro. DjlA expression in the cell is tightly controlled, and even its mild overexpression leads to induction of mucoid capsule. Previous analysis showed that DjlA-mediated induction of the wca capsule operon required the RcsC/RcsB two-component signaling system and that wca induction by DjlA was lost when cells contained mutations in either the dnaK or grpE gene. We now show using allele-specific genetic suppression analysis that DjlA must interact with DnaK for DjlA-mediated stimulation of capsule synthesis. Collectively, these results demonstrate that DjlA is a co-chaperone for DnaK and that this chaperone-co-chaperone pair is implicated directly, or indirectly, in the regulation of colanic acid capsule.