We have constructed a BAC library of the rice blast fungus Magnaporthe grisea consisting of 5760 clones. The insert size ranged from 35 to 175 kbp, with an average of 120 kbp. The library is about 18 genomes equivalent, therefore covering more than 99.999% of the genome. This library is the first to be constructed using a rice pathogenic wild type isolate. Improved high molecular weight DNA size fractionating helped to construct the library with high efficiency. Total library clones were arranged onto two nylon membranes for efficient screening. Test hybridization with a single-copy RFLP marker showed ten positive clones, of which restriction patterns indicated no chimerality or deletions. As a model case of application of this library, the distribution of the well-studied fungal retrotransposons MGSR1, MGR583, and MAGGY and DNA transposons MGR586 and Pot2 was analyzed. Of all the BAC clones, 10%, 13%, 18%, 12%, and 23% contained MGSR1, MGR583, MAGGY, MGR586 and Pot2, respectively. The percentage of clones possessing more than five kinds of transposons was 1.4%, 215 times greater than the expected number. The results show that these transposons were distributed in clusters in the M. grisea genome.