Immunoglobulins (Ig) secreted from a plasma cell contain either chi or lambda light chains, but not both. This phenomenon is termed isotypic chi-lambda exclusion. While chi-producing cells have their lambda chain genes in germline configuration, in most lambda-producing cells the chi chain genes are either non-productively rearranged or deleted. To investigate the molecular mechanism for isotypic chi-lambda exclusion, in particular the role of the Igchi intron enhancer, we replaced this enhancer by a neomycin resistance (neo(R)) gene in embryonic stem (ES) cells. B cells heterozygous for the mutation undergo Vchi-Jchi recombination exclusively in the intact Igchi locus but not in the mutated Igchi locus. Homozygous mutant mice exhibited no rearrangements in their Igchi loci. However, splenic B cell numbers were only slightly reduced as compared with the wild-type, and all B cells expressed lambda chain bearing surface Ig. These findings demonstrate that rearrangement in the Igchi locus is not essential for lambda gene rearrangement. We also generated homozygous mutant mice in which the neo(R) gene was inserted at the 3' end of the Igchi intron enhancer. Unexpectedly, mere insertion of the neo(R) gene showed some suppressive effect on Vchi-Jchi recombination. However, the much more pronounced inhibition of Vchi-Jchi recombination by the replacement of the Igchi intron enhancer suggests that this enhancer is essential for Vchi-Jchi recombination.