An impactor for use with a directional boring machine for replacement of underground pipes includes a bursting head having a rearwardly opening recess and a front end opening that communicates with the recess. An inlet pipe is connected at its front end to a distal end of the drill string and extends into the recess of the bursting head through the front end opening. A striker is mounted for sliding movement along the inlet pipe, and a distributing mechanism responsive to pressure fluid supplied through the drill string and inlet pipe causes the striker to reciprocate in the rearwardly opening recess of the head to deliver forward impacts against the bursting head. The striker and distributing mechanism are mounted in a tubular housing, and a pulling connection is provided by which the impactor can be pulled by the drill string while the striker is delivering impacts against the head in the same direction as a pulling force exerted by the drill string. The bursting head is preferably slidably mounted on the inlet pipe and moves forward relative to the inlet pipe and drill string in response to an impact of the striker against the bursting head. The impactor can be readily used with existing directional boring machines.