The single-stranded DNA (ssDNA)-binding protein (SSB) of bacteriophage phi 29 is one of the virus-encoded proteins required for viral DNA replication. We have found that phi 29 SSB has helix-destabilizing activity since it removes secondary structure of the ssDNA in phi 29 replicative intermediates, as revealed by electron microscopy, and displaces oligonucleotides annealed to M13 ssDNA. To investigate the mechanism of the SSB-dependent stimulation of phi 29 DNA replication we have characterized the helix-destabilizing activity of phi 29 SSB and measured its effect on the DNA elongation rate by phi 29 DNA polymerase, which does not require an accessory helicase. The use of replication reactions where strand displacement is either required (phi 29 DNA replication) or not (conversion of primed M13 ssDNA into double-stranded DNA (dsDNA)) has allowed us to find that (1) strand displacement DNA replication was affected by lowering the temperature or by increasing the salt concentration, since the DNA elongation rate on the phi 29 template was three to fourfold slower than on primed M13 ssDNA, (2) under those conditions, addition of phi 29 SSB stimulated to different extents the DNA elongation rate during phi 29 DNA replication, whereas it had a marginal effect on primed M13 ssDNA replication, and (3) phi 29 SSB increased four to sixfold the phi 29 DNA elongation rate by phi 29 DNA polymerase strand displacement mutants, reaching approximately 50% the rate of the wild-type enzyme. The implications of the helix-destabilizing properties of the phi 29 SSB under conditions in which DNA opening is impaired are discussed.