In the present study, templates containing a specific segment of the G gamma-globin gene were constructed and incorporation of 3'-azido-3'-deoxythymidine 5'-triphosphate (AZT-TP) or 2',3'-dideoxythymidine 5'-triphosphate (ddTTP) into these templates was compared to that observed in M13 bacteriophage DNA. Investigations on the intrinsic fidelity of T7 DNA polymerase in reactions with AZT-TP and without deoxythymidine 5'-triphosphate, resulted in DNA synthesis beyond the first T site, suggesting that other normal deoxynucleotides misincorporated at these T sites. Modified T7 DNA polymerase incorporated AZT-TP into T sites of elongating DNA strands. Chain termination at noncomplementary sites was also observed with AZT-TP when a genomic DNA template was used and interestingly, this phenomenon was not detected in the presence of a M13 DNA template. These DNA template-dependent effects were not detected with either ddTTP, 2',3'-dideoxycytidine 5'-triphosphate, or 2',3'-didehydro-2',3'-dideoxythymidine 5'-triphosphate (D4T-TP). A variation in the extent of chain termination at T sites was observed with D4T-TP suggesting that each 2',3'-dideoxynucleoside may exhibit unique chain termination patterns along with the template sequence.