DNA polymerase and gene 4 protein of bacteriophage T7 catalyze DNA synthesis on duplex DNA templates. Synthesis is initiated at nicks in the DNA template, and this leading strand synthesis results in displacement of one of the parental strands. In the presence of ribonucleoside 5'-triphosphates the gene 4 protein catalyzes the synthesis of oligoribonucleotide primers on the displaced single strand, and their extension by T7 dna polymerase accounts for lagging strand synthesis. Since all the oligoribonucleotide primers bear adenosine 5'-triphosphate residues at their 5' termini, [gamma 32P]ATP is incorporated specifically into the product molecule, thus providing a rapid and sensitive assay for the synthesis of the RNA primers. Both primer synthesis and DNA synthesis are stimulated 3- to 5-fold by the presence of either Escherichia coli or T7 helix-destabilizing protein (DNA binding protein). ATP and CTP together fully satisfy the requirement for rNTPs and provide maximum synthesis of primers and DNA. Provided that T7 DNA polymerase is present, RNA-primed DNA synthesis occurs on either duplex or single-stranded DNA templates and to equal extents on either strand of T7 DNA. No primer-directed DNA synthesis occurs on poly(dT) or poly(dG) templates, indicating that synthesis of primers is template-directed.