The ospE gene family of the Lyme disease spirochetes encodes a polymorphic group of immunogenic lipoproteins. The ospE genes are one of several gene families that are flanked by a highly conserved upstream sequence called the upstream homology box, or UHB, element. Earlier analyses in our lab demonstrated that ospE-related genes are characterized by defined hypervariable domains (domains 1 and 2) that are predicted to be hydrophilic, surface exposed, and antigenic. The flanking of hypervariable domain 1 by DNA repeats may indicate that recombination contributes to ospE diversity and thus ultimately to antigenic variation. Using an isogeneic clone of Borrelia burgdorferi B31G (designated B31Gc1), we demonstrate that the ospE-related genes undergo mutation and rearrangement during infection in mice. The mutations that develop during infection resulted in the generation of OspE proteins with altered antigenic characteristics. The data support the hypothesized role of OspE-related proteins in immune system evasion.