The region immediately 3' of histidine-3 has been cloned and sequenced from two laboratory strains of the ascomycete fungus Neurospora crassa; St Lawrence 74A and Lindegren, which have different derivations from wild collections. Amongst the differences distinguishing these sequences are insertions ranging in size from 20 to 101 bp present only in St Lawrence. The largest of these is flanked by a 3 bp direct repeat, has terminal inverted repeats (TIR) and shares features with several known transposable elements. At 98 bp, it may be the smallest transposable element yet found in eukaryotes. There are multiple copies of the TIR in the Neurospora genome, similar but not identical to the one sequenced. PCR amplification of Neurospora genomic DNA, using 26 bp of the TIR as a single primer, gave products of discrete sizes ranging from 100 bp to about 1.3 kb, suggesting that the element isolated (Guest) may be a deletion derivative of a family of larger transposable elements. Guest appears to be the first transposable element reported in fungi that is not a retrotransposon.