The early stages of murine B-cell differentiation are characterized by a series of immunoglobulin gene rearrangements which are required for the assembly of heavy(H) and light(L)-chain variable regions from germline gene segments. Rearrangement at the heavy-chain locus is initiated first and consists of the joining of a diversity (DH) gene segment to a joining (JH) gene segment. This forms a DJH intermediate to which a variable (VH) gene segment is subsequently added. Light-chain gene rearrangement follows and consists of the joining of a VL gene segment to a JL gene segment: once a productive light-chain gene has been formed the cell initiates synthesis of surface immunoglobulin M (sIgM) receptors (reviewed in ref. 1). These receptors are clonally distributed and may undergo further diversification either by somatic mutation or possibly by continued recombinational events. Such recombinational events have been detected in the Ly 1+ B-cell lymphoma NFS-5, which has been shown to rearrange both lambda and H-chain genes subsequent to the formation of sIgM (mu kappa) molecules. Here we have analysed a rearrangement of the productive allele of NFS-5 and found that it is due to a novel recombination event between VH genes which results in the replacement of most or all of the coding sequence of the initial VHQ52 rearrangement by a germline VH7183 gene. Embedded in the VH coding sequence close to the site of the cross-over is the sequence 5' TACTGTG 3', which is identical to the signal heptamer found 5' of many DH gene segments. This embedded heptamer is conserved in over 70% of known VH genes. We suggest that this heptamer mediates VH gene replacement and may play an important part in the development of the antibody repertoire.