We have previously shown that IS5 contains two genes encoded on opposite DNA strands within the same stretch of DNA. Here we present evidence that a third gene and its promoter are present on IS5. The newly discovered gene, ins5C, is contained within the longest gene of ISS, ins5A, but encoded by the complementary DNA strand. The three genes comprise a total of 519 codons present on the 1195-bp element. The arrangement of these genes represents a coding structure of unprecedented compactness. Key words: transposable element/insertion element/IS5 genes/IS5 promoters/IS5 Results Detection and localization of the promoter p5C To find transcription start signals on IS5 in addition to the ones previously identified, IS5 DNA fragments were inserted into the promoter-search vector-plasmid pK01 (McKenney et al., 1981;Rak et al., 1982) which carries the galactokinase structural gene without a promoter. A 970-bp BstEII-HindIII fragment, derived from plasmid pFDI (pFRI in Rak et al., 1982; see Figure 1), containing IS5: 1-543 and also 427 bp of X DNA (X:36 895-37 322;Sanger et al., 1982;Kroger and Hobom, 1982), was digested with restriction endonuclease HaeIII and the resulting fragments were isolated. The different HaeIII fragments were ligated into the SmaI site of pKOl and the ligation products were transformed into strain N100 (galK, recA). Transformants containing hybrid plasmids which carried the HaeIII fragment in both possible orientations were obtained for all fragments and screened on Introduction Insertion (IS) elements form a group of relatively small (-. 800-1500 bp) DNA sequences found in the genomes of bacteria and in the DNA of their phages and plasmids. Their properties have recently been reviewed by lida et al. (1983). Evidence has accumulated that IS elements not only contain specific sites recognized by proteins mediating their transposition, but also code for proteins required for this event. The frequency of transposition appears to be influenced by the physiological state of the host cell (Arber et al., 1979(Arber et al., , 1981 Arber and lida, 1982), but the ability to regulate transposition functions seems to be a property of the IS element itself (Beck et al., 1980;Biek and Roth, 1980; see also lida et al., 1983). In the case of ISIO it has been proposed that this regulation may be implemented by IS-specific transcripts which inhibit the translation of a message for transposase (Simons and Kleckner, 1983). In the case of IS50 it has been suggested that regulation occurs at a post-translational level, involving an IS-encoded protein (Isberg et al., 1982). No