CRISPR–Cas (clustered regularly interspaced short palindromic repeats-CRISPR associated) systems allow bacteria to adapt to infection by acquiring ‘spacer’ sequences from invader DNA into genomic CRISPR loci. Cas proteins use RNAs derived from these loci to target cognate sequences for destruction through CRISPR interference. Mutations in the protospacer adjacent motif (PAM) and seed regions block interference but promote rapid ‘primed’ adaptation. Here, we use multiple spacer sequences to reexamine the PAM and seed sequence requirements for interference and priming in the Escherichia coli Type I-E CRISPR–Cas system. Surprisingly, CRISPR interference is far more tolerant of mutations in the seed and the PAM than previously reported, and this mutational tolerance, as well as priming activity, is highly dependent on spacer sequence. We identify a large number of functional PAMs that can promote interference, priming or both activities, depending on the associated spacer sequence. Functional PAMs are preferentially acquired during unprimed ‘naïve’ adaptation, leading to a rapid priming response following infection. Our results provide numerous insights into the importance of both spacer and target sequences for interference and priming, and reveal that priming is a major pathway for adaptation during initial infection.