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Transformation of N. meningitidis by homologous, genetically marked DNA may be competitively inhibited by non-marked DNA from N. sicca, E. coli and calf thymus. It seems that homologous DNA has higher inhibiting activity than the other DNA's tested. The binding by recipient cells of radioactivity from labelled DNA preparations was measured in the transformation system. An uptake of radioactivity from intact DNA which could not be removed by deoxyribonuclease treatment and repeated washings was found with homologous DNA but not with DNA from E. coli. This irreversible uptake was restricted to competent recipient cells. The uptake was correlated with genetic transfer. The findings indicate that the first step in DNA uptake is a reversible binding to the surface which may depend upon structures common to double-stranded DNA. The following step appears to be an irreversible phase resulting in deoxyribonuclease insensitivity. This stage seems to be characterized by a specificity for homologous DNA.