Insertion sequence IS1 encodes a transframe protein, InsA-B'-InsB, which is produced from two out-of-phase reading frames, insA and B'-insB, by translational frameshifting at a run of adenines. Unless the frameshifting event occurs, the InsA protein is produced from IS1. We found that cells harboring a plasmid carrying an IS1 mutant with a single adenine insertion in the run of adenines contained miniplasmids. Cloning and DNA sequencing analyses of the miniplasmids revealed that they had a deletion extending from an inverted repeat (IR) at the left end of IS1. This indicates that they were generated by IS1-mediated deletion due to efficient production of the InsA-B'-InsB transframe protein that is IS1 transposase. Both the InsA protein and transposase were partially purified as a fusion protein with collagen-LacZ by LacZ-specific affinity column chromatography. The InsA* and the collagenolyzed InsA* were found to bind specifically to a 24-bp region within each of the IRs at the ends of IS1. The transposase Tnp* and the collagenolyzed Tnp* were found to bind to the sequence with or without IR, but preferentially to that with IR. The nonspecific DNA-binding ability of transposase may be involved in recognition of the target DNA, an important process of transposition of IS1. Both InsA and transposase have the IR-specific DNA binding ability and a common polypeptide segment containing the alpha-helix-turn-alpha-helix motif, supporting the previous indication that InsA competes with transposase to bind to IRs and thus becomes a transposition inhibitor. Based on the observations described in this article, we speculate that transposase of IS1 consists of at least two domains, the N-terminal half, which almost entirely overlaps InsA, and the C-terminal half, which almost entirely overlaps B'-InsB. The frameshifting event adds the latter domain to the former to give the transposase activity recognizing IRs and the target sequence to initiate the transposition reaction.