We have investigated the minimal requirements for a functional origin of DNA replication in an in vitro assay which requires the adeno-associated virus (AAV) Rep 68/78 protein. When a linear duplex template was used, initiation of one round of DNA replication was achieved when nucleotides 1-56 of the AAV inverted terminal repeat (in the flop orientation) were present at the terminus of the template. A terminal resolution site was not required. Deletion of an additional 11 nucleotides from the terminal repeat blocked the reaction.