DNA misalignment occurs in homopolymer tracts during replication and can lead to frameshift mutations. Polymerase (pol) recognition of primer-templates containing bulge structures and the transmission of a bulge through a polymerase binding site or replication complex are important components of frameshift mutagenesis. In this report, we describe the interaction of the catalytic core of pol eta with primer-templates containing bulge structures by single round primer extension. We found that pol eta could stabilize a frayed primer terminus, which enhances its ability to extend primer-templates containing bulges. Based on methylphosphonate-DNA mapping, pol eta interacts with the single strand template but not appreciably with the template strand of the DNA stem greater than two nucleotides from the primer terminus. These latter characteristics, combined with the ability to stabilize a frayed primer terminus, may explain why primer-templates containing template bulges are extended so efficiently by pol eta. Although pol eta could accommodate large bulges and continue synthesis without obstruction, bulge structures in the template, but not in the primer, caused termination of the T7 DNA replication complex. Terminations occurred when the template bulge neared the helix-loop-helix domain of the polymerase thumb. Terminations were not observed, however, when bulge structures approached the site of interaction of the DNA with the extended thumb and thioredoxin. At low temperature, however, terminations did occur at this site.