A gene library constructed from large (approximately 20 kb) fragments of total DNA from the geldananmycin-producing strain Streptomyces hygroscopicus 3602 cloned in the plasmid vector pIJ61 were used to transform S. lividans TK24. Three transformants of about 800 tested were found to have acquired the ability to produce an antibiotic lethal to a geldanamycin-sensitive strain of Bacillus subtilis. The plasmids isolated from these transformants, pIA101, pIA102 and pIA103, each contained an insert of approximately 15 kb. A 4.5 kb DNA fragment from the insert in pIA102 hybridised to DNA from S. hygroscopicus 3602 and to DNA encoding part of the erythromycin polyketide synthase but not to S. lividans TK24 DNA. The integration-defective phage vector phi C31 KC515 containing this 4.5 kb fragment was able to lysogenise S. hygroscopicus 3602 to produce lysogens defective in geldanamycin production. Loss of the prophage restored the ability to produce geldanamycin. Extracts of fermentation broth cultures of S. lividans containing pIA101, pIA102 and pIA102 and pIA103 analysed by thin-layer chromatography (TLC) contained compounds identical or very similar to purified geldanamycin, which were not present in S. lividans. These compounds showed a mass spectrum indistinguishable from geldanamycin. The evidence suggests that the clones contain DNA sequences encoding functions required for geldanamycin biosynthesis including components of the polyketide synthase.