Genes in Caenorhabditis elegans operons are transcribed as polycistronic pre-mRNAs in which downstream gene products are trans spliced to a specialized spliced leader, SL2. SL2 is donated by a 110-nucleotide RNA, SL2 RNA, present in the cell as an Sm-bound snRNP. SL2 RNA can be conceptually folded into a phylogenetically conserved three-stem-loop secondary structure. Here we report an in vivo mutational analysis of the SL2 RNA. Some sequences can be changed without consequence, while other changes result in a substantial loss of trans splicing. Interestingly, the spliced leader itself can be dramatically altered, such that the first stem-loop cannot form, with only a relatively small loss in trans-splicing efficiency. However, the primary sequence of stem II is crucial for SL2 trans splicing. Similarly, the conserved primary sequence of the third stem-loop plays a key role in trans splicing. While mutations in stem-loop III allow snRNP formation, a single nucleotide substitution in the loop prevents trans splicing. In contrast, the analogous region of SL1 RNA is not highly conserved, and its mutation does not abrogate function. Thus, stem-loop III appears to confer a specific function to SL2 RNA. Finally, an upstream sequence, previously predicted to be a proximal sequence element, is shown to be required for SL2 RNA expression.The mature 5Ј ends of mRNAs in many lower eucaryotes, including trypanosomes (41, 50), nematodes (28), trematodes (43), and Euglena (51), are generated through trans splicing. This process involves the donation of a common spliced leader (SL) exon and its associated modified cap structure to the 5Ј ends of mRNAs. The reaction proceeds via two transesterification reactions, analogous to cis splicing of introns, and in fact requires most of the same U snRNP cofactors, including U2, U4, U5, and U6 snRNAs (12,22,36,54). However, because the 5Ј exon is initially located on a separately transcribed RNA, the SL RNA, the intermediate of the trans-splicing reaction is a Y-branched molecule instead of the lariat molecule found in cis splicing. The SL RNA exists as an RNP particle (20,33,52,55) that includes the Sm core proteins that are also associated with most of the U snRNAs involved in cis splicing (30). Unlike the other U snRNPs, which are recycled after catalysis, the SL RNP is consumed during the trans-splicing reaction.In trypanosomes, pre-mRNAs are transcribed polycistronically (26, 40) and the mature mRNAs are generated by trans splicing and 3Ј end formation. Approximately 25% of Caenorhabditis elegans genes are also organized in polycistronic transcription units, or operons (57). However, unlike trypanosomes, C. elegans possesses a distinct SL RNA, SL2 RNA (25), that is specifically utilized to process the products of downstream genes in operons (46). Therefore, the discovery of SL2 on an mRNA is taken as an indication that the gene is in an operon (1, 2).Experiments designed to uncover the mechanism of transsplicing specificity in C. elegans have shown that SL1 trans splicing is usually...