Transposable elements from prokaryotic and eukaryotic organisms are discrete DNA segments bounded by inverted or directly repeated sequences that insert into non-homologous DNA in a reaction that is independent of the general recombination functions of the host. The mechanisms proposed generally involve a staggered double-stranded scission of the target DNA, ligation to the nicked ends of the transposable element, and replication of the element, resulting in the generation of a directly repeated oligonucleotide target sequence flanking the new copy of the element. Most transposons have a relatively low degree of target site specificity coupled with a low insertion frequency. Tn554, a Staphylococcus aureus transposon which specifies resistances to erythromycin and spectinomycin, displays an unusually high degree of insertion specificity. Tn554 transposes with high efficiency to a unique ('primary') site in the S. aureus chromosome and only rarely (less than 10(-6) per transductant) to other, secondary sites. We report here the nucleotide sequences surrounding the junctions of Tn554 in three independent 'primary' insertions and two 'secondary' insertions of the transposon. Two unusual features are revealed: first, the termini of Tn554 contain neither inverted nor directly repeated sequences. Second, transposition of Tn554 does not generate the short direct repeats of the target DNA that are characteristic of other transposable elements. These results suggest that the mechanism of Tn554 insertion may be significantly different from that of other transposons.