Removal of interstrand cross-linked from DNA was examined in Escherichia coli permeabilized by treatment with toluene. Under these conditions, the reaction requires ATP and Mg2+, and the mechanism appears to be similar to that occurring in whole cells. Under optimum conditions, the rate constant was 0.06 min-1. Genetical, physical, and biochemical analysis of the repair process suggest the following mechanism. In an ATP-dependent reaction, the uvrA and uvrB gene products cleave a phosphodiester bond on the 5' side of one arm of the cross-link, producing a 3'-OH terminus. Subsequently, DNA polymerase I (5'-3' exonuclease activity) makes a second strand cut on the 3' side of the cross-link in the same DNA strand, completing removal of the covalent link between complementary strands. The second reaction did not occur in a uvrD- strain, which had normal levels of DNA polymerizing activity. The uvrD gene may regulate the specificity or activity of the 5'-3' exonuclease of DNA polymerase I in vivo.