The functional interaction between the RNA-dependent DNA polymerase and the RNase H activities of reverse transcriptases (RTs) were examined using a 272 nucleotide long plasmid-derived RNA transcript primed in a specific location. Properties of the avian myeloblastosis virus (AMV) RT, the human immunodeficiency virus RT and the Moloney murine leukemia virus RT were examined. All three enzymes formed stable complexes with the primer-template with half-lives ranging from about 16 to 41 s. Each enzyme synthesized full-length primer extension products and cleaved the RNA template at least once during DNA synthesis. Polymerization was then assayed in the presence of challenger RNA that effectively sequestered RTs after one round of processive DNA synthesis. This assay allowed measurement of the number of endonucleolytic cleavages catalyzed by the RT during one encounter with the primer-template. Results indicated that each of the three RTs cut the transcript before dissociating from the primer-template, whether or not deoxynucleoside triphosphates were present to allow synthesis. During synthesis, the extent of RNA degradation differed among the RTs, with AMV-RT generating mostly large segments of RNA-DNA hybrid, and virtually no small RNA cleavage products. Human immunodeficiency virus and Moloney murine leukemia virus-RT generated more small degradation products than AMV-RT, but still left much of the potentially degradable hybrid undigested. Results demonstrate that the RNase H function is much less active than the polymerization function during processive DNA synthesis and that the activities are not strictly coupled.