A modified actinomycin D was prepared with a hydroxyl group that replaced the amino group at the chromophore 2-position, a substitution known to strongly reduce affinity for double-stranded DNA. Interactions of the modified drug on single-stranded DNAs of the defined sequence were investigated. Competition assays showed that 2-hydroxyactinomycin D has low affinity for two oligonucleotides that have high affinities ($K_a;=;5-10{ imes}10^6;M^{-1}$ oligomer) for 7-aminoactinomycin D and actinomycin D. Primer extension inhibition assays performed on several single-stranded DNA templates totaling around 1000 nt in length detected a single high affinity site for 2-hydroxyactinomycin D, while many high affinity binding sites of unmodified actinomycin D were found on the same templates. The sequence selectivity of 2-hydroxyactinomycin D binding is unusually high and approximates the selectivity of restriction endonucleases. Binding appears to require a complex structure, including residues well removed from the polymerase pause site.