We analyzed a cloned fragment of the yeast URA3 promoter region that contains a sequence of DNA capable of functioning as a highly efficient transcription terminator. BAL 31 deletions have shown the signal for the transcription termination activity is less than or equal to 110 base pairs and resides between bases 45 and 155 upstream of the URA3 primary ATG codon at base 227. In our in vivo assay system, the DNA fragment is able to terminate transcripts very efficiently in either orientation. The terminated transcripts bind to oligodeoxythymidylate cellulose columns and promote the synthesis of full-length cDNAs, suggesting that the transcripts are polyadenylated. The 110-base-pair region contains no sequence resembling terminator consensus sequences described by Zaret and Sherman (K.S. Zaret and F. Sherman, Cell, 28:563-573, 1982) or Henikoff and Cohen (S. Henikoff and E.H. Cohen, Mol. Cell. Biol., 4:1515-1520, 1984). We discuss the possible physiological relevance of this sequence to bona fide termination of transcription and to URA3 regulation in Saccharomyces cerevisiae.