An in vitro system based upon extracts of Escherichia coli infected with bacteriophage T7 was used to study the mechanism of double-strand break repair. Double-strand breaks were placed in T7 genomes by cutting with a restriction endonuclease which recognizes a unique site in the T7 genome. These molecules were allowed to repair under conditions where the double-strand break could be healed by (i) direct joining of the two partial genomes resulting from the break, (ii) annealing of complementary versions of 17-bp sequences repeated on either side of the break, or (iii) recombination with intact T7 DNA molecules. The data show that while direct joining and single-strand annealing contributed to repair of double-strand breaks, these mechanisms made only minor contributions. The efficiency of repair was greatly enhanced when DNA molecules that bridge the region of the double-strand break (referred to as donor DNA) were provided in the reaction mixtures. Moreover, in the presence of the donor DNA most of the repaired molecules acquired genetic markers from the donor DNA, implying that recombination between the DNA molecules was instrumental in repairing the break. Double-strand break repair in this system is highly efficient, with more than 50% of the broken molecules being repaired within 30 min under some experimental conditions. Gaps of 1,600 nucleotides were repaired nearly as well as simple double-strand breaks. Perfect homology between the DNA sequence near the break site and the donor DNA resulted in minor (twofold) improvement in the efficiency of repair. However, double-strand break repair was still highly efficient when there were inhomogeneities between the ends created by the double-strand break and the T7 genome or between the ends of the donor DNA molecules and the genome. The distance between the double-strand break and the ends of the donor DNA molecule was critical to the repair efficiency. The data argue that ends of DNA molecules formed by double-strand breaks are typically digested by between 150 and 500 nucleotides to form a gap that is subsequently repaired by recombination with other DNA molecules present in the same reaction mixture or infected cell.