Transcripts from an ADC1-actin gene fusion containing the yeast actin intron are efficiently spliced in vivo. Four distinct forms of the excised actin intron are found in poly(A)- RNA from yeast carrying this transcription unit on a multicopy plasmid. Two of them migrate abnormally slowly in polyacrylamide gels, and one of these contains a block to reverse transcription at the conserved UACUAAC sequence (TACTAAC box). We also detect a larger RNA in the poly(A)+ fraction with abnormal gel mobility and the same reverse transcriptase block. Analysis of the major species of excised actin intron, labeled with 32P in vivo, reveals the presence of a branch at the third A in the UACUAAC sequence. This A is linked via a 3'-5' phosphodiester bond to the downstream C, and via a 2'-5' phosphodiester bond to a G, presumably from the 5' end of the intron. Thus this intron RNA is in the form of a lariat.