DNA termini from Tetrahymena and Oxytricha, which bear C4A2 and C4A4 repeats respectively, can support telomere formation in Saccharomyces cerevisiae by serving as substrates for the addition of yeast telomeric C1-3A repeats. Previously, we showed that linear plasmids with 108 base pairs of C4A4 DNA (YLp108CA) efficiently acquired telomeres, whereas plasmids containing 28-64 base pairs of C4A4 DNA also promoted telomere formation, but with reduced efficiency. Although many of the C4A4 termini on these plasmids underwent recombination with a C4A2 terminus, the mechanism of telomere-telomere recombination was not established. We now report the sequence of the C4A4 ends from the linear plasmids. The results provide strong evidence for a novel recombination process involving a gene conversion event that requires little homology, occurs at or near the boundary of telomeric and nontelomeric DNA, and resembles the recombination process involved in bacteriophage T4 DNA replication.