At the DNA level, antigenic variation in trypanosomes is brought about by the replacement of one variant surface glycoprotein (VSG) gene by another in an expression site with a strong promoter. In several cases studied, mobilization of a VSG gene for expression involves a duplication-transposition. We have determined the DNA sequence of most of the transposed segment of one such VSG, the VSG 118. At the 3' side, the transposed segment ends within the end of the gene; at the 5' side, the transposed segment is preceded by a putative VSG gene, extending our previous conclusion that VSG genes are tightly clustered. The total length of the transposed segment is about 3.5 X 10(3) base-pairs and 1.8 X 10(3) base-pairs of this codes for the VSG 118 messenger RNA. Near the 5' border of the transposed segment we find five imperfect repeats of about 70 base-pairs that are also present in front of other VSG genes, as shown by hybridization. The termini of three minor VSG 118-specific transcripts map within these repeats. The repeats have the potential to adopt non-B-DNA conformations, and could play a role in the recombination process that exchanges VSG genes in the expression site or, less likely, in pre-mRNA processing. Comparison of the DNA and the mRNA sequence has previously revealed that a terminal exon of 35 nucleotides is spliced onto the main body of the RNA. We show here that these 35 nucleotides are not in the transposed segment and they must, therefore, be contributed by the expression site. This argues persuasively that the transposition activates VSG gene expression by promoter addition rather than by a position effect.