We have investigated the in vitro fidelity of Escherichia coli DNA polymerase III holoenzyme from a wild-type and a proofreading-impaired mutD5 strain. Exonuclease assays showed the mutD5 holoenzyme to have a 30-50-fold reduced 3'-->5'-exonuclease activity. Fidelity was assayed during gap-filling synthesis across the lacId forward mutational target. The error rate for both enzymes was lowest at low dNTP concentrations (10-50 microM) and highest at high dNTP concentration (1000 microM). The mutD5 proofreading defect increased the error rate by only 3-5-fold. Both enzymes produced a high level of (-1)-frameshift mutations in addition to base substitutions. The base substitutions were mainly C-->T, G-->T, and G-->C, but dNTP pool imbalances suggested that these may reflect misincorporations opposite damaged template bases and that, instead, T-->C, G-->A, and C-->T transitions represent the normal polymerase III-mediated base.base mispairs. The frequent (-1)-frameshift mutations do not result from direct slippage but may be generated via a mechanism involving "misincorporation plus slippage." Measurements of the fidelity of wild-type and mutD5 holoenzyme during M13 in vivo replication revealed significant differences between the in vivo and in vitro fidelity with regard to both the frequency of frameshift errors and the extent of proofreading.