Stochastic mechanisms are ubiquitous in biological systems. Biochemical reactions that involve small numbers of molecules are intrinsically noisy, being dominated by large concentration fluctuations. This intrinsic noise has been implicated in the random lysis/lysogeny decision of bacteriophage-lambda, in the loss of synchrony of circadian clocks and in the decrease of precision of cell signals. We sought to quantitatively investigate the extent to which the occurrence of molecular fluctuations within single cells (biochemical noise) could explain the variation of gene expression levels between cells in a genetically identical population (phenotypic noise). We have isolated the biochemical contribution to phenotypic noise from that of other noise sources by carrying out a series of differential measurements. We varied independently the rates of transcription and translation of a single fluorescent reporter gene in the chromosome of Bacillus subtilis, and we quantitatively measured the resulting changes in the phenotypic noise characteristics. We report that of these two parameters, increased translational efficiency is the predominant source of increased phenotypic noise. This effect is consistent with a stochastic model of gene expression in which proteins are produced in random and sharp bursts. Our results thus provide the first direct experimental evidence of the biochemical origin of phenotypic noise, demonstrating that the level of phenotypic variation in an isogenic population can be regulated by genetic parameters.