The alpha-hemolysin gene from Staphylococcus aureus, excluding the 5' region encoding the hydrophobic leader sequence, was amplified from genomic DNA. The identity of the disputed C terminus has been confirmed and revisions made to the internal sequence. The hemolysin is expressed at high levels in Escherichia coli and has been purified to homogeneity from this source. In addition, active [35S-Met]alpha-hemolysin of high specific radioactivity can be generated in an E. coli transcription-translation system. By criteria based on protein chemistry, and biological and electrophysiological assays, the recombinant polypeptide is closely similar to the staphylococcal polypeptide ruling out the possibility of functionally important posttranslational modifications in S. aureus. Convenient new assays utilizing the 35S-labeled polypeptide to measure erythrocyte binding, oligomer formation in detergent and on target cells, and hemolysis have been developed. They have been used to demonstrate that a deletion mutant of alpha-hemolysin, in which five C-terminal amino acids are absent, is severely compromised in its ability both to oligomerize and to lyse rabbit erythrocytes. The mutant polypeptide nevertheless binds tightly to erythrocytes as a monomer, strengthening the idea that oligomerization is required for cell lysis.