An insertion sequence, IS1081, in the genome of Mycobacterium bovis has been identified and sequenced. It is 1324 bp long with 15 bp inverted repeat ends and contains a large ORF. There are six copies of IS1081 in the genome of M. bovis and the element is also present in Mycobacterium tuberculosis. IS1081 is not closely related to other DNA elements described in actinomycetes but its putative transposase bears some resemblance to that of IS256 from Staphylococcus aureus. IS1081 may be useful for genetic manipulations and for developing a diagnostic test for bovine tuberculosis based on the polymerase chain reaction.