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The genetic manipulation of large plasmid DNA often requires the fortuitous presence of convenient restriction enzyme sites. For large plasmids, such as those containing full length recombinant adenovirus, it is desirable to direct the cloning or sequence alterations without having to depend on such convenient restriction sites. We report a general and efficient method to modify or clone large covalently closed circular DNA molecules at any predetermined sequence. This procedure involves two main steps. First, supercoiled DNA is hybridized to a short pre-selected synthetic oligonucleotide to form a D-loop. This hybrid is then linearized in vitro at that target site by digestion with S1 nuclease. Second, D-loop/S1 linearized DNA is transformed into E. coli with a second linear DNA fragment carrying a foreign gene flanked by sequences homologous to the target site. In vivo recombination results in the desired recombinant construct. We demonstrate the use of this method by cloning the SV40 origin of replication into the E3 transcription unit of human adenovirus type 5. [ABSTRACT FROM AUTHOR]