We have analyzed the effects of site-specific N-2-acetylaminofluorene (AAF) adducts on the efficiency and frameshift fidelity of bidirectional replication of double-stranded DNA in a human cell extract. Plasmid vectors were constructed containing the simian virus 40 origin of replication and single AAF adducts at one of three guanines in the Nar I sequence GGCGCC in a lacZ reporter gene. The presence of an AAF adduct diminishes replication efficiency in HeLa cell extracts by 70-80%. Replication product analyses reveal unique termination sites with each damaged vector, suggesting that when the replication fork encounters an AAF adduct, it often stops before incorporation opposite the adduct. We also observed a higher proportion of products representing replication of the undamaged strand compared to the damaged strand. This suggests that the undamaged strand is replicated more readily, either by uncoupling the first fork to encounter the lesion or by replication using the fork arriving from the other direction. Also included among replication products are covalently closed monomer-length molecules resistant to cleavage at the AAF-modified Nar I site. This resistance is characteristic of substrates containing the AAF adduct, suggesting that translesion bypass had occurred. Transformation of Escherichia coli cells with the replicated damaged DNA yielded lacZ alpha revertant frequencies significantly above values obtained with undamaged DNA or with damaged DNA not replicated in vitro. This increase was only seen with the substrate modified at the third guanine position. Analysis of mutant DNA demonstrated the loss of a GC dinucleotide at the Nar I sequence. Generation of this position-dependent AAF-induced frameshift error in a human replication system is consistent with previous observations in E. coli suggesting that, after incorporation of dCMP opposite modified guanine in the third position, realignment of the template-primer occurs to form an intermediate with two unpaired nucleotides in the template strand.