Intracellular DNA has been isolated in virtually quantitative yield from Escherichia coli infected with bacteriophage λ. Isotopic pulse-chase experiments have demonstrated two stages during replication of phage DNA. The first stage is characterised by the synthesis of covalently closed circular molecules which are apparently not packaged into progeny phage particles. The second phase occurs by 15 min after infection and results in the formation of linear DNA molecules as found in mature phage particles. Ultracentrifugation, electron microscopy and autoradiography have been used to examine the structure of the replicating DNA during the two stages. The first replicating structure is apparently a circular from of phage λ DNA containing two forks. The second replicating form, as isolated, contains DNA molecules several times longer than that of mature phage DNA The latter species is the major precursor of mature phage DNA. © 1969.