During poxvirus infection, both viral genomes and transfected DNAs are converted into high-molecular-weight concatemers by the replicative machinery. However, aside from the fact that concatemer formation coincides with viral replication, the mechanism and protein(s) catalyzing the reaction are unknown. Here we show that vaccinia virus DNA polymerase can catalyze single-stranded annealing reactions in vitro, converting linear duplex substrates into linear or circular concatemers, in a manner directed by sequences located at the DNA ends. The reaction required > or =12 bp of shared sequence and was stimulated by vaccinia single-stranded DNA-binding protein (gpI3L). Varying the structures at the cleaved ends of the molecules had no effect on efficiency. These duplex-joining reactions are dependent on nucleolytic processing of the molecules by the 3'-to-5' proofreading exonuclease, as judged by the fact that only a 5'-(32)P-end label is retained in the joint molecules and the reaction is inhibited by dNTPs. The resulting concatemers are joined only through noncovalent bonds, but can be processed into stable molecules in E. coli, if the homologies permit formation of circular molecules. This reaction provides a starting point for investigating the mechanism of viral concatemer formation and can be used to clone PCR-amplified DNA.