Infection of Escherichia coli containing the type I restriction enzyme EcoKI by bacteriophage T7 0.3 mutants leads to restriction during the late stages of genome entry and during DNA replication. Patterns of cleavage in vivo suggest that some cutting occurs near the midpoint of two recognition sites, consistent with the idea that EcoKI translocates DNA bidirectionally through itself and cuts when two enzyme molecules collide. Rapid ejection of a 0.3(+) T7 genome from a bacteriophage lambda particle results in degradation of the infecting DNA by EcoKI, showing that the normal T7 DNA translocation process delays restriction. A unique recognition site inserted at the genomic left end allows EcoKI to function as a molecular motor and to translocate the remaining 39 kilobases of T7 DNA into the cell.