The 2 mu plasmid of the yeast Saccharomyces cerevisiae encodes a site-specific recombination system consisting of plasmid-encoded FLP protein and two recombination sites on the plasmid. The recombination site possesses a specific orientation, which is determined by an asymmetric 8-base pair spacer sequence separating two 13-base pair inverted repeats. The outcome or directionality of site-specific recombination is defined by the alignment of two sites in the same orientation during the reaction. Sites containing point mutations or 1-base pair insertions or deletions within the spacer generally undergo recombination with unaltered sites at reduced levels. In contrast, recombination between the two identical mutant sites (where homology is restored) proceeds efficiently in all cases. Sites containing spacer sequences of 10 base pairs or more are nonfunctional under all conditions. A recombination site in which 5 base pairs are changed to yield an entirely symmetrical spacer sequence again recombines efficiently, but only with an identical site. This reaction, in addition, produces a variety of new products which can only result from random alignment of the two sites undergoing recombination, i.e. the reaction no longer exhibits directionality. These and other results demonstrate that both the efficiency and directionality of site-specific recombination is dependent upon homology between spacer sequences of the two recombining sites. This further implies that critical DNA-DNA interactions between the spacer region of the two sites involved in the reaction occur at some stage during site-specific recombination in this system. The specific spacer sequence itself appears to be unimportant as long as homology is maintained; thus, these sequences are probably not involved in recognition by FLP protein.