The discovery of a new DNA-targeted antitumor agent is a challenging enterprise, and the elucidation of its mechanism of action is an essential first step in investigating the structural and biological consequences of DNA modification and to guide the rational design of analogues. Here, we have dissected the mode of action of the newly discovered antitumor agent S23906-1. Gel retardation experiments reveal that the diacetate compound S23906-1 and its monoacetate analogue S28687 form highly stable covalent adducts with DNA. The covalent adducts formed between S23906-1 and a 7-bp hairpin oligonucleotide duplex were identified by spectrometry. In contrast, the inactive compound S23907, lacking the two acetate groups of S23906-1, fails to yield covalent DNA adducts, indicating that the C1-C2 functionality is the DNA reactive moiety. DNase I footprinting and DNA alkylation experiments indicate that S23906-1 reacts primarily with guanine residues. A 30-mer oligonucleotide containing only G.C bp forms highly stable complexes with S23906-1 and S28687, whereas the equivalent A.T oligonucleotide is not a good substrate for these two drugs. The use of an oligonucleotide duplex containing inosines instead of guanosines identifies the guanine 2-amino group exposed in the minor groove of DNA as the potential reactive site. The reactivity of S23906-1 toward the guanine-N2 group was independently confirmed by fluorescence spectroscopy. Covalent DNA adducts were also identified in the genomic DNA of B16 melanoma cells exposed to S23906-1, and the specific accumulation of the drug in the nucleus of the cells was visualized by confocal microscopy. The elucidation of the mechanism of action of this highly potent anticancer agent opens a new field for future drug design.