The asgB genetic locus of Myxococcus xanthus specifies a function which is required early in the developmental pathway leading to aggregation and sporulation in fruiting bodies. The developmental defect of asgB mutants can be compensated by extracellular complementation using either intact wild-type cells or cell-free supernatants conditioned by developing wild-type cells. A Tn5 insertion was isolated closely linked to asgB480 and facilitated the cloning of both the wild-type (asgB+) and the mutant (asgB480) alleles in Escherichia coli plasmid. Tandem duplications of the asgB locus were constructed in M. xanthus; the completely wild-type phenotype of asgB+/asgB480 partial diploids implies that the asgB480 allele is recessive. This finding, along with extracellular complementation by wild-type cells, is consistent with the hypothesis that the asgB+ locus is required to produce a substance with an intercellular signalling function. At least part of the asgB gene was found to lie within a 1.2 kb SmaI DNA fragment. This 1.2 kb fragment, as well as smaller fragments derived from it, were used as DNA probes in RNA/DNA hybrid analyses of transcription in the asgB region. Two small mRNA species were detected, one about 650 bp long, and the other about 500 bp; the two species of mRNAs apparently overlap. Both mRNAs are present in low, but approximately equal amounts, in vegetatively growing cells. This is consistent with the observation that asg mutants display a mutant vegetative phenotype (a change in colony color and spreading behavior) as well as defective development.