A rapid increase in the prevalence of beta-lactamase-producing Moraxella (Branhamella) catarrhalis strains has been noticed during the last decades. Today, more than 80% of strains isolated worldwide produce beta-lactamase. To investigate beta-lactamase(s) of M. catarrhalis at the molecular level, the BRO-1 beta-lactamase gene (bla) was isolated as part of a 4,223-bp HindIII fragment. Sequence analysis indicated that bla encodes a polypeptide of 314 amino acid residues. Insertional inactivation of bla in M. catarrhalis resulted in complete abrogation of beta-lactamase production and ampicillin resistance, demonstrating that bla is solely responsible for beta-lactam resistance. Comparison with other beta-lactamases suggested that M. catarrhalis beta-lactamase is a unique enzyme with conserved residues at the active sites. The presence of a signal sequence for lipoproteins suggested that it is lipid modified at its N terminus. In keeping with this assumption was the observation that 10% of beta-lactamase activity was found in the membrane compartment of M. catarrhalis. M. catarrhalis strains produce two types of beta-lactamase, BRO-1 and BRO-2, which differ in their isoelectric points. The BRO-1 and BRO-2 genes from two ATCC strains of M. catarrhalis were sequenced, and only one amino acid difference was found between the predicted products. However, there was a 21-bp deletion in the promoter region of the BRO-2 gene, possibly explaining the lower level of production of BRO-2. The G + C content of bla (31%) was significantly lower than those of the flanking genes (47 and 50%), and the overall G + C content of the M. catarrhalis genome (41%). These results indicate that bla was acquired by horizontal gene transfer from another, still unknown species.