Phages can use a small-molecule communication arbitrium system to coordinate lysis-lysogeny decisions, but the underlying mechanism remains unknown. Here we determined that the arbitrium system in Bacillus subtilis phage phi3T modulates the bacterial toxin-antitoxin system MazE-MazF to regulate the phage life cycle. We show that phi3T expresses AimX and YosL, which bind to and inactivate MazF. AimX also inhibits the function of phi3T_93, a protein that promotes lysogeny by binding to MazE and releasing MazF. Overall, these mutually exclusive interactions promote the lytic cycle of the phage. After several rounds of infection, the phage-encoded AimP peptide accumulates intracellularly and inactivates the phage antiterminator AimR, a process that eliminates aimX expression from the aimP promoter. Therefore, when AimP increases, MazF activity promotes reversion back to lysogeny, since AimX is absent. Altogether, our study reveals the evolutionary strategy used by arbitrium to control lysis-lysogeny by domesticating and fine-tuning a phage-defence mechanism.