Potato D-enzyme was purified from recombinant Escherichia coli, and its action on synthetic amylose (average M(r) of 320,000) was analyzed. D-enzyme treatment resulted in a decrease in the ability of the amylose to form a blue complex with iodine. Analysis of the products indicated that the enzyme catalyzes an intramolecular transglycosylation reaction on amylose to produce cyclic alpha-1,4-glucan (cycloamylose). Confirmation of the cyclic structure was achieved by demonstrating the absence of reducing and nonreducing ends, resistance to hydrolysis by glucoamylase (an exoamylase), and by ''time of flight'' mass spectrometry. The degree of polymerization of cycloamylose products was determined by time of flight mass spectrometry analysis and by highperformance anion-exchange chromatography following partial acid hydrolysis of purified cycloamylose molecules and was found to range from 17 to several hundred. The yield of cycloamylose increased with time and reached >95%, D-enzyme did not act upon purified cycloamylose, but if glucose was added as an acceptor molecule, smaller cyclic and linear molecules were produced. The mechanism of the cyclization reaction, the possible role of the enzyme in starch metabolism, and the potential applications for cycloamylose are discussed.