The gene D5 product (gpD5) of bacteriophage T5 is a DNA-binding protein that binds preferentially to double-stranded DNA and is essential for T5 DNA replication, yet it inhibits DNA synthesis in vitro. Mechanisms of inhibition were studied by using nicked DNA and primed single-stranded DNA as a primer-template. Inhibition of T5 DNA polymerase activity by gpD5 occurred when double-stranded regions of DNA were saturated with gpD5. The 3' leads to 5' exonuclease associated with T5 DNA polymerase was not very active with nicked DNA, but inhibition of hydrolysis of substituents at 3'-hydroxyl termini by gpD5 could be observed. T5 DNA polymerase appears to be capable of binding to the 3' termini even when double-stranded regions are saturated with gpD5. The interaction of gpD5 with the polymerases at the primer terminus is apparently the primary cause of inhibition of polymerization.