The hot white dwarf in the close binary EUVE J1016Ϫ053 (ϭRE 1016Ϫ053) has been classified as a DAO white dwarf; its mixed H͞He composition has been attributed to steady accretion from the close red dwarf companion. We have obtained extreme-ultraviolet (EUV) photometric and spectroscopic observations of EUVE J1016Ϫ053 with the Extreme Ultraviolet Explorer (EUVE). We report the discovery of a 230% EUV flux variation over a period of 57.3 minutes, which we attribute to surface abundance inhomogeneities modulated over the stellar rotation period, P rot . The EUVE spectrum shows the effect of heavy-element opacities on the white dwarf EUV energy distribution. Spectral synthesis including trace opacities of helium and a group of heavy elements (C, N, O, Si, S, Fe) in the otherwise hydrogen-rich atmosphere constrains abundances to Y͞Y J ϭ Z͞Z J ϭ 2 ϫ 10 Ϫ3 , in support of a simple accretion model. The low surface-averaged helium abundance measured in the white dwarf atmosphere limits the accretion rate to between 10 Ϫ19 and 10 Ϫ18 M J yr Ϫ1 , i.e., much lower than the Bondi-Hoyle accretion rate, which is of the same order as the red dwarf mass-loss rate (Ն10 Ϫ14 M J yr Ϫ1 ), therefore invalidating a simple wind-accretion model. We speculate that weak mass loss from the white dwarf or interaction with a magnetosphere may inhibit accretion onto the white dwarf. Accretion of heavy elements may also be restricted to smaller areas, possibly correlating to magnetic poles.