Several plasmid-encoded beta-lactamases are on multiresistance transposable elements. The OXA-1 beta-lactamase gene is part of Tn2603, which is borne on the R plasmid RGN238. We report here the complete nucleotide sequence of the OXA-1 beta-lactamase gene and flanking sequences. The OXA-1 gene shows a greater than 50% sequence divergence from the OXA-2 gene, yet there is significant functional similarity at the peptide level. Analysis of 5' and 3' flanking sequences shows that Tn2603 differs from its probable precursor, Tn21, by a precise 1004-base-pair insertion, containing the OXA-1 structural gene, at the target sequence AAAGTT, which is located between the Tn21 streptomycin/spectinomycin (aadA) promoter and its structural gene. A 5-for 6-base repeat of the target sequence is found at the end of the insertion. The same precise insertion and repeat of the target sequence are found for the OXA-2 gene from R46. The 5' flanking regions of two other genes, the trimethoprim-resistance gene from R388 and the gentamicin resistance (aadB) gene from pDGO100, are greater than 98% homologous to the 5' flanking sequences of the OXA-1, OXA-2, and aadA genes until they diverge at the target sequence. From the available sequence data a recombinational hot spot is defined at the nucleotide level 5' of the aadA gene of Tn21, and a second potential hot spot is proposed 3' of this gene.