We present a system for random mutagenesis in Escherichia coli for the evolution of targeted genes. To increase error rates of DNA polymerase I (Pol I) replication, we introduced point mutations in three structural domains that govern Pol I fidelity. Expression of error-prone Pol I in vivo results in strong mutagenesis of a target sequence encoded in a Pol I-dependent plasmid (8.1 x 10-4 mutations per bp, an 80,000-fold increase), with a preference for plasmid relative to chromosome sequence. Mutagenesis is maximal in cultures maintained at stationary phase. Mutations are evenly distributed and show a variety of base pair substitutions, predominantly transitions. Mutagenesis extends at least 3 kb beyond the 400-500 nt reportedly synthesized by Pol I. We demonstrate that our error-prone Pol I can be used to generate enzymes with distinct properties by generating TEM-1 beta-lactamase mutants able to hydrolyze a third-generation lactam antibiotic, aztreonam. Three different mutations contribute to aztreonam resistance. Two are found in the extended-spectrum beta-lactamases most frequently identified in clinical isolates, and the third (G276R) has not been previously described. Our system of targeted mutagenesis in E. coli should have an impact on enzyme-based applications in areas such as synthetic chemistry, gene therapy, and molecular biology. Given the structural conservation between polymerases, this work should also provide a reference for altering the fidelity of other polymerases.