We report here the molecular organization of the capsular locus (cap1) of the type 1 pneumococcus. This locus is located between dexB and aliA and flanked by IS1167 insertion elements. Sequence analysis showed that the cluster contains 11 genes (cap1A to cap1K), which are apparently arranged as a single transcriptional unit. The presence of a functional promoter (cap1p) located upstream of cap1A has been demonstrated and the transcription start point was mapped by primer-extension analysis. A 14.3 kb fragment containing the genes cap1ABCDEFGHIJK and including cap1p was sufficient to allow the synthesis of a type 1 capsule in Streptococcus pneumoniae. An internal deletion of cap1E leads to an unencapsulated phenotype demonstrating that this gene is essential for capsular production. The cap1K gene has been expressed in Escherichia coli resulting in UDP-glucose dehydrogenase (UDP-GlcDH) activity. Moreover, this gene was able to restore the synthesis of type 3 capsule when cloned into a plasmid and introduced by transformation into S. pneumoniae cap3A mutants deficient in UDP-GlcDH. In marked contrast with what was previously thought, recombination between cap1K and cap3A does occur. We provide data on the molecular mechanism that leads to the formation of binary encapsulated pneumococcal cells, i.e. strains that simultaneously produce type 1 and type 3 capsules. Downstream of cap1K, one truncated and three complete open reading frames homologous to those involved in the biosynthesis of dTDP-rhamnose, a monosaccharide that does not participate in the formation of type 1 polysaccharide, have been identified in all the clinical strains of type 1 pneumococcus tested. Our results provide new insights into the generation of capsule diversity in pneumococci.