The molecular mechanism of serial VH replacement was analyzed using a human B cell line, EU12, that undergoes continuous spontaneous differentiation from pro-B to pre-B and then to B cell stage. In earlier studies, we found that this cell line undergoes intraclonal V(D)J diversification. Analysis of the IgH gene sequences in EU12 cells predicted the occurrence of serial VH replacement involving the cryptic recombination signal sequences (cRSS) embedded within framework 3 regions and concurrent extension of the CDR3 region. Detection of double-stranded DNA breaks at the cRSS site and different VH replacement excision circles confirm the ongoing nature of this diversification process in the EU12 cells. In vitro binding and cleavage assays using recombinant RAG-1 and RAG-2 proteins further validated the cRSS participation in this RAG-mediated recombination process. Serial VH replacements may represent an additional mechanism for diversification of the primary B cell repertoire.