In vitro mutagenesis was performed to identify the DNA packaging domain of the 120-base pRNA essential and specific for DNA encapsidation by bacteriophage phi 29 of Bacillus subtilis. All deletions and mutations targeted the 5' and 3' ends of the pRNA. DNA templates of a control or mutant pRNAs used for in vitro transcription with T7 RNA polymerase were generated by PCR. Fourteen mutant pRNA molecules were synthesized from DNA templates either directly after PCR or after cloning the PCR fragments into the pCR II vector. Ten of the mutant pRNA species were inactive in packaging of the phi 29 genome. Mutation of base one at the 5' end did not affect the pRNA packaging activity. Mutation of the first two bases at the 5' end of the pRNA to noncomplementary bases in the predicted RNA secondary structure (U1 C2/A117G116 to G1 G2/A117G116) resulted in a pRNA with no detectable DNA-gp3 packaging activity assayed by either sucrose gradient sedimentation or agarose gel electrophoresis, and 10(5)-fold reduction in activity was found when measured by plaque-forming units with a new highly sensitive assay system. Changing bases 116 and 117 so that they were complementary to the mutated bases, 1 and 2, from the previous mutant (G1 G2/A117G116 to G1 G2/C117C116) generated an RNA molecule with restored DNA packaging ability. Our results show that, although not essential for procapsid binding, both the 5' and 3' ends of the pRNA were proximate and crucial for phi 29 DNA packaging.