In Vibrio cholerae, the second messenger cyclic di-GMP (c-di-GMP) positively regulates biofilm formation and negatively regulates virulence and is proposed to play an important role in the transition from persistence in the environment to survival in the host. Herein we describe a characterization of the infection-induced gene cdpA, which encodes both GGDEF and EAL domains, which are known to mediate diguanylate cyclase and c-di-GMP phosphodiesterase (PDE) activities, respectively. CdpA is shown to possess PDE activity, and this activity is regulated by its inactive degenerate GGDEF domain. CdpA inhibits biofilm formation but has no effect on colonization of the infant mouse small intestine. Consistent with these observations, cdpA is expressed during in vitro growth in a biofilm but is not expressed in vivo until the late stage of infection, after colonization has occurred. To test for a role of c-di-GMP in the early stages of infection, we artificially increased c-di-GMP and observed reduced colonization. This was attributed to a significant reduction in toxT transcription during infection. Cumulatively, these results support a model of the V. cholerae life cycle in which c-di-GMP must be down-regulated early after entering the small intestine and maintained at a low level to allow virulence gene expression, colonization, and motility at appropriate stages of infection.