Abstract A new cloning system for Bacillus subtilis was devised which makes use of a combination of Tn 917-containing phage SPβ derivatives and Tn P17-containing Escherichia coli-B. subtilis shuttle plasmids. This system allows the initial cloning of genes in single copy, via ‘prophage transformation’, with a selection for complementation of mutational defects in B. subtilis hosts and permits subsequent transfer of the cloned material by homologous recombination to low-copy and high-copy vectors that replicate in both B. subtilis and E. coli. Because cloned sequences are adjacent to pB322-derived DNA in the recombinant phages, inserts can also be ‘rescued’ directly from the phage DNA after digestion with appropriate restriction enzymes, circularization of the fragments by ligation and transformation of an E. coli recipient. Two genomic libraries of B. subtilis chromosomal Sau3A-generated partial-digest fragments in the size ranges of 5–8 kb and 8–10 kb were constructed and screened for the complementation of mutations aroI906, cysA 14, dal-1, glyB133, metC3, purA 16, purB33, thrA5, trpC2 and recE4. In all cases, specialized transducing phages carrying inserts that complemented the selected markers were recovered. Inserts complementing the dal-1 and trpC2 mutations could be transferred from recombinant phages to Tn 917-containing plasmids by homologous recombination without in vitro subcloning. Another insert complementing the purB33 mutation was rescued directly into E. coli from a recombinant phage DNA.