Chi sites enhance in their vicinity homologous recombination by the E. coli RecBC pathway. We report here that RecBC enzyme catalyzes Chi-dependent cleavage of one DNA strand, that containing the Chi sequence 5'G-C-T-G-G-T-G-G3'. Chi-specific cleavage is greatly reduced by single base pair changes within the Chi sequence and by mutations within the E. coli recC gene, coding for a RecBC enzyme subunit. Although cleavage occurs preferentially with double-stranded DNA, the product of the reaction is single-stranded DNA. These results demonstrate the direct interaction of RecBC enzyme with Chi sites that was inferred from the genetic properties of Chi and recBC, and they support models of recombination in which Chi acts before the initiation of strand exchange.