Rhodococcus sp. RHA1 (RHA1) is a potent polychlorinated biphenyl-degrading soil actinomycete that catabolizes a wide range of compounds and represents a genus of considerable industrial interest. RHA1 has one of the largest bacterial genomes sequenced to date, comprising 9,702,737 bp (67% G+C) arranged in a linear chromosome and three linear plasmids. A targeted insertion methodology was developed to determine the telomeric sequences. RHA1's 9,145 predicted protein-encoding genes are exceptionally rich in oxygenases (203) and ligases (192). Many of the oxygenases occur in the numerous pathways predicted to degrade aromatic compounds (). RHA1 also contains 24 nonribosomal peptide synthase genes, six of which exceed 25 kbp, and seven polyketide synthase genes, providing evidence that rhodococci harbor an extensive secondary metabolism. Among sequenced genomes, RHA1 is most similar to those of nocardial and mycobacterial strains. The genome contains few recent gene duplications. Moreover, three different analyses indicate that RHA1 has acquired fewer genes by recent horizontal transfer than most bacteria characterized to date and far fewer than Burkholderia xenovorans LB400, whose genome size and catabolic versatility rival those of RHA1. RHA1 and LB400 thus appear to demonstrate that ecologically similar bacteria can evolve large genomes by different means. Overall, RHA1 appears to have evolved to simultaneously catabolize a diverse range of plant-derived compounds in an O2-rich environment. In addition to establishing RHA1 as an important model for studying actinomycete physiology, this study provides critical insights that facilitate the exploitation of these industrially important microorganisms.