A yeast gene has been identified by screening for DNA replication mutants using a permeabilized cell replication assay. The mutant is temperature sensitive for growth and shows a cell cycle phenotype typical of DNA replication mutants. RNA synthesis is normal in the mutant but DNA synthesis ceases upon shift to the nonpermissive temperature. The DNA2 gene was cloned by complementation of the dna2ts gene phenotype. The gene is essential for viability. The gene encodes a 172-kDa protein with characteristic DNA helicase motifs. A hemagglutinin epitope-Dna2 fusion protein was prepared and purified by conventional and immunoaffinity chromatography. The purified protein is a DNA-dependent ATPase and has 3' to 5' DNA helicase activity specific for forked substrates. A nuclease activity that endonucleolytically cleaves DNA molecules having a single-stranded 5' tail adjacent to a duplex region copurifies through all steps with the fusion protein.