NaeI, a type-II restriction-modification (R-M) system from the bacterium Nocardia aerocolonigenes, recognizes the sequence 5'-GCCGGC. The NaeI DNA methyltransferase (MTase)-encoding gene, naeIM, had been cloned previously in Escherichia coli [Van Cott and Wilson, Gene 74 (1988) 55-59]. However, none of these clones expressed detectable levels of the restriction endonuclease (ENase). The absence of the intact ENase-encoding gene (naeIR) within the isolated MTase clones was confirmed by recloning the MTase clones into Streptomyces lividans. The complete NaeI system was finally cloned using E. coli AP1-200 [Piekarowicz et al., Nucleic Acids Res. 19 (1991) 1831-1835] and less stringent MTase-selection conditions. The naeIR gene was expressed first by cloning into S. lividans, and later by cloning under control of a regulated promoter in an E. coli strain preprotected by the heterologous MspI MTase (M.MspI). The DNA sequence of the NaeI R-M system has been determined, analyzed and compared to previously sequenced R-M systems.