A statistical method was developed for reconstructing the nucleotide o
r amino acid sequences of extinct ancestors, given the phylogeny and s
equences of the extant species. A model of nucleotide or amino acid su
bstitution was employed to analyze data of the present-day sequences,
and maximum likelihood estimates of parameters such as branch lengths
were used to compare the posterior probabilities of assignments of cha
racter states (nucleotides or amino acids) to interior nodes of the tr
ee; the assignment having the highest probability was the best reconst
ruction at the site. The lysozyme c sequences of six mammals were anal
yzed by using the likelihood and parsimony methods. The new likelihood
-based method was found to be superior to the parsimony method. The pr
obability that the amino acids for all interior nodes at a site recons
tructed by the new method are correct was calculated to be 0.91, 0.86,
and 0.73 for all, variable, and parsimony-informative sites, respecti
vely, whereas the corresponding probabilities for the parsimony method
were 0.84, 0.76, and 0.51, respectively. The probability that an amin
o acid in an ancestral sequence is correctly reconstructed by the like
lihood analysis ranged from 91.3 to 98.7% for the four ancestral seque
nces.