The Autographa californica multiple nucleocapsid nucleopolyhedrovirus (AcMNPV) alkaline nuclease (AN) likely participates in the maturation of virus genomes and in DNA recombination. AcMNPV AN was expressed in a recombinant baculovirus as a His -tagged fusion and obtained in pure form (*AN) or as a (6)complex with the baculoviral single-stranded DNA-binding protein LEF-3 (*AN/L3). Both AN preparations possessed potent 5' --> 3'-exonuclease and weak endonuclease activities. Mutant *AN(S146A)/L3 with a change from serine to alanine at position 146 in a conservative motif was impaired in both activities. This proved that the endonuclease is an intrinsic activity of baculovirus AN. The AN endonuclease showed specificity for single-stranded DNA and converted supercoiled plasmid DNA (replicative form I, RFI) into the open circular form (RFII) by a single strand break. Plasmid DNA relaxed with topoisomerase I was resistant to *AN/L3 indicating that the partially single-stranded regions in negatively supercoiled molecules served as targets for the endonuclease. Unwinding the supercoiled DNA with ethidium bromide also made DNA resistant to AN/L3. In reactions with nicked circular DNA (RFII), AN and AN/L3 hydrolyzed exonucleolytically the broken strand or cut endonucleolytically the intact strand at the position opposite the nick (gap). When LEF-3 was added to the assay, the balance between the exonucleolytic and endonucleolytic modes of hydrolysis shifted in favor of the exonuclease. The data suggest that the AN endonuclease may digest the intermediates in replication and recombination at positions of structural irregularities in DNA duplexes, whereas LEF-3 may further regulate processing of the intermediates by AN via the endonuclease and exonuclease pathways.

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