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According to the endosymbiotic theory, mitochondria are descended from specialised bacteria (probably purple nonsulfur bacteria) that somehow survived endocytosis by another species of prokaryote or some other cell type, and became incorporated into the cytoplasm [ref].

And plasmids naturally exist in bacterial cells, and they also occur in some eukaryotes [ref].

I was however taught that mitochondria have no plasmid and only have circular DNA. If the endosymbiotic theory is true, then how come mitochondria have no plasmid?

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The mitochondrial genome is highly reduced; many mitochondrial genes have been transferred to the nuclear genome (see endosymbiotic gene transfer) and therefore the mitochondria are fully dependent on the nucleus to function.

Bacteria need not necessarily have a plasmid. Usually, all the important genes are present in the chromosomal DNA. Since the mitochondria have lost most of their genes and retain only a few genes that are highly essential for their function, the likelihood of retention of any plasmid DNA is very low. However, there are some reports of plasmid-like DNA in mitochondria (mostly in plants).

  1. Handa (2008): in Brassica
  2. Robison et al., (2005): in carrots
  3. Collins et al., (1981): in Neurospora (a fungus)

Likewise, chloroplasts also harbour plasmid-like DNA (google-scholar hits).

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