A single Borrelia burgdorferi bacterium may contain six or more different 32 kb circular plasmids (cp32s). Although these plasmids are homologous throughout much of their sequences, two loci have been identified at which they can vary significantly. The cp32 plasmids and their relatives each contain two adjacent genes, orfC and orf3, that vary in sequence between plasmids found within clones of individual bacteria. The orfC gene product is homologous to proteins involved in partitioning of bacterial plasmids, and the differences at this locus between plasmids may account for their compatibility. The orfC-orf3 loci are located approximately 5 kb from another variable locus called erp. The orfC-orf3 loci were used as physically linked markers to assess genetic rearrangements in the erp loci; this revealed examples of recombination involving both individual genes and entire erp loci. Recombination of the genes encoding the Erp antigens might contribute to the evasion of the mammalian immune response and could play roles in the establishment and persistence of B. burgdorferi infections in mammalian hosts.