Strain SVQ121 is a mutant derivative of Sinorhizobium fredii HH103 carrying a transposon Tn5-lacZ insertion into the nolO-coding region. Sequence analysis of the wild-type gene revealed that it is homologous to that of Rhizobium sp. NGR234, which is involved in the 3 (or 4)-O-carbamoylation of the nonreducing terminus of Nod factors. Downstream of nolO, as in Rhizobium sp. NGR234, the noeI gene responsible for methylation of the fucose moiety of Nod factors was found. SVQ121 Nod factors showed lower levels of methylation into the fucosyl residue than those of HH103-suggesting a polar effect of the transposon insertion into nolO over the noel gene. A noeI HH103 mutant was constructed. This mutant, SVQ503, produced Nod factors devoid of methyl groups, confirming that the S. fredii noeI gene is functional. Neither the nolO nor the noeI mutation affected the ability of HH103 to nodulate several host plants, but both mutations reduced competitiveness to nodulate soybean. The Nod factors produced by strain HH103, like those of other S. fredii isolates, lack carbamoyl residues. By using specific polymerase chain reaction primers, we sequenced the nolO gene of S. fredii strains USDA192, USDA193, USDA257, and 042B(s). All the analyzed strains showed the same -1 frameshift mutation that is present in the HH103 nolO-coding region. From these results, it is concluded that, regardless of their geographical origin, S. fredii strains carry the nolO-coding region but that it is truncated by the same base-pair deletion.