Lipid-linked intermediates are involved in the synthesis of the exopolysaccharide xanthan produced by the bacterium Xanthomonas campestris (L. Ielpi, R. O. Couso, and M. A. Dankert, FEBS Lett. 130:253-256, 1981). In this study, the stepwise assembly of the repeating pentasaccharide unit of xanthan is described. EDTA-treated X. campestris cells were used as both enzyme preparation and lipid-P acceptor, and UDP-Glc, GDP-Man, and UDP-glucuronic acid were used as sugar donors. A linear pentasaccharide unit is assembled on a polyprenol-P lipid carrier by the sequential addition of glucose-1-P, glucose, mannose, glucuronic acid, and mannose. The in vitro synthesis of pentasaccharide-P-P-polyprenol was also accompanied by the incorporation of radioactivity into a polymeric product, which was characterized as xanthan, on the basis of gel filtration and permethylation studies. Results from two-stage reactions showed that essentially pentasaccharide-P-P-polyprenol is polymerized. In addition, the direction of chain elongation has been studied by in vivo experiments. The polymerization of lipid-linked repeat units occurs by the successive transfer of the growing chain to a new pentasaccharide-P-P-polyprenol. The reaction involves C-1 of glucose at the reducing end of the polyprenol-linked growing chain and C-4 of glucose at the nonreducing position of the newly formed polyprenol-linked pentasaccharide, generating a branched polymer with a trisaccharide side chain.