McrBC-mediated restriction of modified DNA has been studied extensively by genetic methods, but little is known of its molecular action. We have used overproducing plasmid constructs to facilitate purification of the McrBL and McrC proteins, and report preliminary characterization of the activity of the complex. Both proteins are required for cleavage of appropriately modified DNA in vitro, in a reaction absolutely dependent on GTP. ATP inhibits the reaction. The sequence and modification requirements for cleavage of the substrate reflect those seen in vivo. The position of cleavage was examined at the nucleotide level, revealing that cleavage occurs at multiple positions in a small region. Based upon these observations, and upon cleavage of model oligonucleotide substrates, it is proposed that the recognition site for this enzyme consists of the motif RmC(N40-80)RmC, with cleavage occurring at multiple positions on both strands, between the modified C residues. In subunit composition, cofactor requirement, and relation between cleavage and recognition site, McrBC does not fit into any of the classes (types I to IV) of restriction enzyme so far described.