The cultivation of Bt cotton has been much in the news. What does the prefix "Bt" in Bt cotton signify?

Cotton containing a gene derived from Bacillus thuringiensis that produces an endotoxin

The correct answer is Option (4)- Cotton carrying an endotoxin gene from Bacillus thuringiensis.

Bt toxin is produced by a bacterium called Bacillus thuringiensis (Bt for short). Bt toxin gene has been cloned from the bacteria and been expressed in plants to provide resistance to insects without the need for insecticides; in effect created a bio-pesticide. Examples are Bt cotton, Bt corn, rice, tomato, potato and soyabean etc.

Bt Cotton: Some strains of Bacillus thuringiensis produce proteins that kill certain insects such as lepidopterans (tobacco budworm, armyworm), coleopterans (beetles) and dipterans (flies, mosquitoes). B. thuringiensis forms protein crystals during a particular phase of their growth. These crystals contain a toxic insecticidal protein. Actually, the Bt toxin protein exist as inactive protoxins but once an insect ingest the inactive toxin, it is converted into an active form of toxin due to the alkaline pH of the gut which solubilise the crystals. The activated toxin binds to the surface of midgut epithelial cells and create pores that cause cell swelling and lysis and eventually cause death of the insect.