We constructed an artificial yeast rRNA gene and studied its transcription after introduction into a recipient yeast strain. The artificial gene comprised a fragment containing the sequence from position -207 to +128 relative to the site of initiation of Saccharomyces carlsbergensis 37S pre-rRNA, followed by a marker fragment from Spirodela oligorhiza chloroplast DNA and finally a fragment containing the sequence from position -36 to +101 relative to the 3' end of the 26S rRNA gene. The resulting construct was cloned into the yeast-Escherichia coli shuttle vector pJDB207. Both Northern blot hybridization and R-loop analysis of RNA from transformed Saccharomyces cerevisiae cells revealed a discrete transcript of the expected length. S1 nuclease mapping as well as primer extension analysis showed that the major proportion of the transcripts was initiated at exactly the same site as 37S pre-rRNA. These results show that the respective rDNA fragments contain the information for correct initiation of transcription and formation of the 3' end. A minor proportion of the transcripts was initiated at a number of sites between positions -1 and -100 upstream of the predominant start. The proportion and the pattern of these upstream starts is affected by the vector context of the artificial rRNA gene.