Highly purified, but not homogeneous, samples of helix-destabilizing protein 1 from mouse myeloma contain a novel oligonucleotide-releasing DNA exonuclease. This enzyme was separated from helix-destabilizing protein 1 and obtained in highly purified form. A polypeptide of Mr 41 000 is a main constituent of the purified enzyme, and this polypeptide comigrated with the exonuclease activity during the final step of the purification, Sephacryl S-200 gel filtration where the enzyme had a native Mr of 40 000. Overall purification of enzyme activity was greater than 20 000-fold. This exonuclease releases 5'-oligonucleotides in a limited processive manner in both the 5'----3' and 3'----5' directions. Activity of the enzyme is resistant to 1 mM N-ethylmaleimide, requires a divalent cation, has an alkaline pH optimum, and degrades single-stranded DNA much faster than double-stranded DNA or RNA. The predominant oligonucleotide product with uniformly labeled substrates is (pdN)2. With 3' end labeled substrates, greater than 95% of the labeled products are (pdN)4 and (pdN)5; with 5' end labeled substrates, the main labeled product is (pdA)2. The rate of product release from 3' and 5' end labeled substrates is nearly identical at 37 degrees C. A model of the action of this enzyme and a comparison with a human placenta exonuclease [Doniger, J., & Grossman, L. (1976) J. Biol. Chem. 251, 4579-4587] are discussed.