The HO endonuclease promotes gene conversion between mating-type alleles in yeast by a DNA double-strand break at the site of conversion (the MAT-Y/Z site). As a first step toward understanding the molecular basis of homologous recombination in higher plants, we demonstrate that expression of HO in Arabidopsis enhances intrachromosomal recombination between inverted repeats of two defective beta-glucuronidase (gus) genes (GUS- test construct). One of these genes has the Y/Z site. The two genes share 2.5 kb of DNA sequence homology around the HO cut site. Somatic recombination between the two repeats was determined by using a histochemical assay of GUS activity. The frequency of Gus+ sectors in leaves of F1 plants from a cross between parents homozygous for the GUS- test construct and HO, respectively, was 10-fold higher than in F1 plants from a cross between the same plant containing the GUS- test construct and a wild-type parent. Polymerase chain reaction analysis showed restoration of the 5' end of the GUS gene in recombinant sectors. The induction of intrachromosomal gene conversion in Arabidopsis by HO reveals the general utility of site-specific DNA endonucleases in producing targeted homologous recombination in plant genomes.