An ovine adenovirus which may be the prototype for a new group of adenoviruses has been engineered as a gene transfer vector. One recombinant containing a 0.95-kb insertion expressed a sheep parasite antigen from the ovine adenovirus major late promoter and tripartite leader sequences. It was shown that insertions of at least 4.3 kb were tolerated at either one of two sites in the genome without the introduction of a compensating deletion. The unique structure of this viral genome was further emphasized by the discovery that four open reading frames at the right hand end show significant identity to each other but not to other sequences in the databases. Two other unrelated open reading frames were also present. RT-PCR analysis identified two transcripts in this region which were derived from a promoter which was located very close to, or within the ITR sequence. Splicing removed all but the first and last of the ORFs from these RNAs, suggesting that some sequences might be nonessential for replication in vitro. A approximately 2-kb deletion, which removed or truncated the internal reading frames was introduced into the region without affecting virus viability. The carrying capacity of OAV recombinants should therefore be at least 6.3 kb. The relative packaging capacity of OAV (114%) therefore exceeds that of Ad5 (105%), although a comparison of virus particle sizes by electron microscopy showed that OAV was smaller than Ad5. These studies improve the potential utility of OAV as a gene transfer vector.