DNA transposition is central to the propagation of temperate phage Mu. A long-standing problem in Mu biology has been the mechanism by which the linear genome of an infecting phage, which is linked at both ends to DNA acquired from a previous host, integrates into the new host chromosome. If Mu were to use its well-established cointegrate mechanism for integration (single-strand nicks at Mu ends, joined to a staggered double-strand break in the target), the flanking host sequences would remain linked to Mu; target-primed replication of the linear integrant would subsequently break the chromosome. The absence of evidence for chromosome breaks has led to speculation that infecting Mu might use a cut-and-paste mechanism, whereby Mu DNA is cut away from the flanking sequences prior to integration. In this study we have followed the fate of the flanking DNA during the time course of Mu infection. We have found that these sequences are still attached to Mu upon integration and that they disappear soon after. The data rule out a cut-and-paste mechanism and suggest that infecting Mu integrates to generate simple insertions by a variation of its established cointegrate mechanism in which, instead of a "nick, join, and replicate" pathway, it follows a "nick, join, and process" pathway. The results show similarities with human immunodeficiency virus integration and provide a unifying mechanism for development of Mu along either the lysogenic or lytic pathway.