Cycloalternan-forming enzyme (CAFE) was first described as the enzyme that produced cycloalternan from alternan. In this study, we found that a partially purified preparation of CAFE containing two proteins catalyzed the synthesis of cycloalternan from maltooligosaccharides, whereas the purified CAFE alone was unable to do so. In addition to the 117 kDa CAFE itself, the mixture also contained a 140 kDa protein. The latter was found to be a disproportionating enzyme (DE) that catalyzes transfer of a D-glucopyranosyl residue from the non-reducing end of one maltooligosaccharide to the non-reducing end of another, forming an isomaltosyl residue at the non-reducing end. CAFE then transfers the isomaltosyl residue to the non-reducing end of another isomaltosyl maltooligosaccharide, to form an alpha-isomaltosyl-(1-->3)-alpha-isomaltosyl-(1-->4)-maltooligosaccharide, and subsequently catalyzes a cyclization to produce cycloalternan. Thus, DE and CAFE act synergistically to produce cycloalternan directly from maltodextrin or starch.