Cre/lox site-specific recombination systems provide important tools for genetic manipulation. Here we present an efficient method for gene tagging and gene replacement using Cre recombinase-mediated cassette exchange (RMCE). The cassette consists of the S. pombe ura4(+) selectable marker flanked by a wild-type loxP site at one end and by a modified heterospecific lox site (loxM3) at the other. The cassette is stable because the flanking lox sites cannot recombine with each other. Following integration of the cassette at the chosen chromosomal locus, exchange is achieved by introducing a Cre-expression plasmid containing an equivalent cassette containing the required tag or gene sequence. Recombinants are selected by uracil prototrophy using the reagent 5-fluoroorotic acid (5-FOA). The cassette exchange system provides for repetitive integrations at the same locus, allowing different protein tags or gene sequences to be integrated quickly and efficiently. We have established a range of reagents and verified utility by C-terminally tagging the S. pombe rad4 and swi1 genes with yEGFP and the yEGFP derivatives yECFP and yECitrine and by transferring the coding sequence for both genes.