The polypeptide encoded by the plasmid RP4 traE gene shows extensive protein sequence similarity to Escherichia coli topB, the gene encoding DNA topoisomerase III (Topo III). The traE gene product has been cloned into a bacteriophage T7-based transient expression system, and the polypeptide has been expressed and purified. The TraE protein exhibits topoisomerase activity similar to that of Topo III. Relaxation is stimulated by high temperature and low concentrations of Mg2+. In addition, similar to E. coli Topo III, the TraE protein is a potent decatenase and can substitute for Topo III activity in vivo. The biochemical properties of the TraE protein in vitro suggest that the protein may be involved in the resolution of plasmid DNA replication intermediates either during vegetative replication or in conjugative DNA transfer. Putative homologues of Topo III have been found to be encoded by other broad host range, conjugative plasmids isolated from both Gram-negative and Gram-positive organisms, suggesting that Topo III-like polypeptides may have an essential role in the propagation of many promiscuous plasmids.