Bacteriophage fd gene II-protein was characterized as an endonuclease which specifically nicked supercoiled replicative form (RF) of filamentous phages in the viral strand. No other supercoiled DNAs tested were attacked by the enzyme, nor were doubly closed fd RF in the relaxed state nor phage fd single strands. Maximal activity was found at pH 8.5 and 80 mM KCl using fd RFI of physiological superhelicity. Mg2+, but no other cofactor, was required for the cleavage reaction. A sealing activity was found to be associated with the enzyme. At a higher concentration of Mg2+ up to 40% of the reaction products were found as doubly closed relaxed fd RF. The protein was not found to be tightly attached to the cleaved strand.