Structural and functional annotation of the large and growing database of genomic sequences is a major problem in modern biology. Protein structure prediction by detecting remote homology to known structures is a well-established and successful annotation technique. However, the broad spectrum of evolutionary change that accompanies the divergence of close homologues to become remote homologues cannot easily be captured with a single algorithm. Recent advances to tackle this problem have involved the use of multiple predictive algorithms available on the Internet. Here we demonstrate how such ensembles of predictors can be designed in-house under controlled conditions and permit significant improvements in recognition by using a concept taken from protein loop energetics and applying it to the general problem of 3D clustering. We have developed a stringent test that simulates the situation where a protein sequence of interest is submitted to multiple different algorithms and not one of these algorithms can make a confident (95%) correct assignment. A method of meta-server prediction (Phyre) that exploits the benefits of a controlled environment for the component methods was implemented. At 95% precision or higher, Phyre identified 64.0% of all correct homologous query–template relationships, and 84.0% of the individual test query proteins could be accurately annotated. In comparison to the improvement that the single best fold recognition algorithm (according to training) has over PSI-Blast, this represents a 29.6% increase in the number of correct homologous query–template relationships, and a 46.2% increase in the number of accurately annotated queries. It has been well recognised in fold prediction, other bioinformatics applications, and in many other areas, that ensemble predictions generally are superior in accuracy to any of the component individual methods. However there is a paucity of information as to why the ensemble methods are superior and indeed this has never been systematically addressed in fold recognition. Here we show that the source of ensemble power stems from noise reduction in filtering out false positive matches. The results indicate greater coverage of sequence space and improved model quality, which can consequently lead to a reduction in the experimental workload of structural genomics initiatives. Proteins 2008. © 2007 Wiley-Liss, Inc.