The envelope of Gram-negative bacteria is an essential compartment that constitutes a protective and permeability barrier between the cell and its environment. The envelope also hosts the cell wall, a mesh-like structure made of peptidoglycan (PG) that determines cell shape and provides osmotic protection. Since the PG must grow and divide in a cell-cycle-synchronized manner, its synthesis and remodeling are tightly regulated. Here, we discovered that PG homeostasis is intimately linked to the levels of activation of the Cpx system, an envelope stress response system traditionally viewed as being involved in protein quality control in the envelope. We first show that Cpx is activated when PG integrity is challenged and that this activation provides protection to cells exposed to antibiotics inhibiting PG synthesis. By rerouting the outer membrane lipoprotein NlpE, a known Cpx activator, to a different envelope subcompartment, we managed to manipulate Cpx activation levels. We found that Cpx overactivation leads to aberrant cellular morphologies, to an increased sensitivity to β-lactams, and to dramatic division and growth defects, consistent with a loss of PG homeostasis. Remarkably, these phenotypes were largely abrogated by the deletion of ldtD, a Cpx-induced gene involved in noncanonical PG cross-linkage, suggesting that this transpeptidase is an important link between PG homeostasis and the Cpx system. Altogether our data show that fine-tuning of an envelope quality control system constitutes an important layer of regulation of the highly organized cell wall structure. OBJECTIVE The envelope of Gram-negative bacteria is essential for viability. First, it includes the cell wall, a continuous polymer of peptidoglycan (PG) that determines cell morphology and protects against osmotic stress. Moreover, the envelope constitutes a protective barrier between the cell interior and the environment. Therefore, mechanisms called envelope stress response systems (ESRS) exist to monitor and defend envelope integrity against harmful conditions. Cpx is a major ESRS that detects and manages the accumulation of misfolded proteins in the envelope of Escherichia coli. We found that this protein quality control system also plays a fundamental role in the regulation of PG assembly. Strikingly, the level of Cpx response is critical, as an excessive activation leads to phenotypes associated with a loss of cell wall integrity. Thus, by contributing to PG homeostasis, the Cpx system lies at the crossroads between key processes of bacterial life, including cell shape, growth, division, and antibiotic resistance.