In this study, we examined the ability of adenoviral (Ad) vectors to undergo homologous recombination. The lacZ gene was divided between two parental, first-generation vectors such that neither encoded a functional product but both shared 494 bp in common. The open reading frame could only be restored by homologous recombination. We observed beta-galactosidase activity only upon co-infection of both parental vectors and after the onset of viral DNA replication, creating a delay in expression of 24-36 hours in HeLa cells. At peak efficiency, this recombination vector system resulted in beta-galactosidase activity levels 100x above background and just 18x less than a conventional, first-generation vector in HeLa cells. After recombination, the resultant progeny vector genomes containing reconstituted expression cassettes were devoid of all viral genes and contained two packaging signals. These progeny genomes were efficiently packaged, could be separated from their parental vectors based on their lighter buoyant densities in CsCl gradients, and were subsequently used as functional gene transfer vectors. This novel recombination vector system should be useful for transferring large transgenes (because the carrying capacity of two Ad vectors can be exploited) or expressing any cytotoxic or Ad replication inhibitory protein (because the parental vectors exhibit no background expression).