The exponential growth of sequence databases poses a major challenge to bioinformatics tools for querying alignment and annotation databases. There is a pressing need for methods for finding overlapping sequence intervals that are highly scalable to database size, query interval size, result size and construction/updating of the interval database. We have developed a new interval database representation, the Nested Containment List (NCList), whose query time is O(n + log N), where N is the database size and n is the size of the result set. In all cases tested, this query algorithm is 5-500-fold faster than other indexing methods tested in this study, such as MySQL multi-column indexing, MySQL binning and R-Tree indexing. We provide performance comparisons both in simulated datasets and real-world genome alignment databases, across a wide range of database sizes and query interval widths. We also present an in-place NCList construction algorithm that yields database construction times that are approximately 100-fold faster than other methods available. The NCList data structure appears to provide a useful foundation for highly scalable interval database applications. NCList data structure is part of Pygr, a bioinformatics graph database library, available at http://sourceforge.net/projects/pygr
