The Fusarium oxysporum gene nia, encoding nitrate reductase (NR), was isolated from a cosmid library by direct complementation of an F. oxysporum nia- mutant. The gene specifies a protein of 905 amino acids and contains a 57-bp intron. Comparison of the deduced aa sequence with NR of other fungi revealed a high degree of similarity and conservation in the intron position. The cloned nia made it possible to develop the first homologous transformation system for this fungus. Transformation frequencies of up to 600 transformants per microgram of DNA were achieved. Gene replacement, single-copy homologous integrations and integrations at non-homologous sites were observed. Direct comparison between plasmids and cosmids carrying the same gene showed a higher frequency of targeted transformation using cosmid vectors. Gene replacement events were observed in about 50% of the transformants analysed with each type of vector used. This high frequency of substitution offers new applications for the transformation system in F. oxysporum.