Recent studies on proteins whose N and C termini are in close proximity have demonstrated that folding of polypeptide chains and assembly of oligomers can be accomplished with circularly permuted chains. As yet no methodical study has been conducted to determine how extensively new termini can be introduced and where such termini cannot (4), gp120 of human immunodeficiency virus 1 (HIV-1) (5), interleukin 113 (6), mouse ornithine decarboxylase (7), bacteriophage T4 lysozyme (8, 9), the catalytic subunit of Escherichia coli aspartate transcarbamoylase (10, 11), ribonuclease Ti (12, 13), Bacillus ,B-glucanase (14), E. coli DHFR (15), interleukin 4 (16-18), the SH3 domain of a-spectrin (19), E. coli outer membrane protein A (20), Bacillus stearothermophilus glyceraldyhyde-3-phosphate dehydrogenase (21), and 'yB-crystallin (22).Most of these enzymes were permuted at one or two positions, and only few were subjected to a systematic permutation analysis (11,13,19). Although evidence has accumulated that new N and C termini in flexible solvent-exposed loops are readily tolerated, the question arises whether free termini can be moved into other areas of a protein; e.g., within secondary structure elements or into the hydrophobic core. However, even with the availabilty of efficient strategies based on tandem gene constructs that are used to produce "sitedirected" circular permutants (6,11,12), a one-by-one exhaustive permutation analysis of a protein of several hundred residues in length is hardly a practicable approach. Therefore, we devised a technique to construct a random collection of circularly permuted DNA molecules containing the complete coding sequence for the desired polypeptide chain along with a linker between the original C-and N-terminal regions. These rearranged genes were incorporated into a suitable plasmid for expression of the randomly permuted polypeptide chains in E. coli. Colonies containing stable and/or active protein formed from these chains were identified by either an immunoblot assay or by the suppression of auxotrophy because of the presence of active enzyme.For these studies we have utilized the catalytic (c) polypeptide chain of E. coli aspartate transcarbamoylase (ATCase; Abbreviations: ATCase, aspartate transcarbamoylase; c chain, catalytic polypeptide chain; C trimer, catalytic trimer or subunit; r subunit, regulatory subunit or dimer.