An immunoglobulin epsilon-chain fragment was synthesized in E. coli by cloning and expression of the gene coding for the second, third and fourth constant domains of the human IgE heavy chain. The bacterial CH2-4 polypeptide product was assembled by oxidation into a covalently linked dimeric epsilon-chain molecule presumably analogous to the Fc region of native IgE. This bacterial Fc epsilon preparation, within the concentration range 0.01-10 micrograms/ml, inhibited sensitization of human lung mast cells, determined as histamine released upon challenge with specific antigen. Monomer CH2-4 epsilon-chain polypeptide, prepared by reduction and alkylation of the active bacterial Fc epsilon fragment, was inactive as an inhibitor of sensitization. The molar potency of the active bacterial Fc epsilon product was approximately one fourth of that of native IgE. Since the bacterial Fc epsilon is nonglycosylated, carbohydrate does not make an essential contribution to the Fc receptor binding activity of IgE. These results show that a functionally active immunoglobulin molecule can be synthesized by gene cloning and expression in E. coli.