When spread chromatin is visualized by electron microscopy, active rRNA genes have a characteristic Christmas tree appearance: From a DNA "trunk" extend closely packed "branches" of nascent transcripts whose ends are decorated with terminal "balls." These terminal balls have been known for more than two decades, are shown in most biology textbooks, and are reported in hundreds of papers, yet their nature has remained elusive. Here, we show that a rRNA-processing signal in the 5'-external transcribed spacer (ETS) of the Xenopus laevis ribosomal primary transcript forms a large, processing-related complex with factors of the Xenopus oocyte, analogous to 5' ETS processing complexes found in other vertebrate cell types. Using mutant rRNA genes, we find that the same rRNA residues are required for this biochemically defined complex formation and for terminal ball formation, analyzed electron microscopically after injection of these cloned genes into Xenopus oocytes. This, plus other presented evidence, implies that rRNA terminal balls in Xenopus, and by inference, also in the multitude of other species where they have been observed, are the uhrastructural visualization of an evolutionarily conserved 5' ETS processing complex that forms on the nascent rRNA.[Key Words: rRNA processing complex; terminal balls; eukaryotic rRNA transcription units; chromatin spreads; X. laevis] Received February 5, 1993; revised version accepted May 21, 1993.One of the earliest, yet still highly informative and much used methods of studying eukaryotic gene expression, is by direct electron microscopic visualization of the transcribing chromatin (Miller and Beatty 1969a). This technique of native chromatin visualization (forming socalled Miller spreads) has facilitated numerous advances in the analysis of gene expression. These include (1) the finding that eukaryotic rRNA genes are organized typically in tandem head-to-tail arrays separated by "nontranscribed spacers" (Miller and Beatty 1969a); (2) the demonstration that the polarity of ribosomal transcription is from 18S to 28S (Reeder et al. 1976), (3) the first analyses of the synchrony of rRNA transcriptional turnon during development Foe 1978;Franke et al. 1979); (4) the first indication of transcription of cloned rRNA genes (Trendelenburg and Gutdon 1978); and (5) the ability to visualize spliceosome complexes on nascent RNA polymerase II-driven transcripts Beyer and Osheim 1988).