A detailed structural and functional model of E. coli RNase T was generated based on sequence analysis, homology modeling, and experimental observation. In the accompanying article, three short sequence segments (nucleic acid binding sequences (NBS)) important for RNase T substrate binding were identified. In the model, these segments cluster to form a positively charged surface patch. However, this patch is on the face of the RNase T monomer opposite the DEDD catalytic center. We propose that by dimerization, the NBS patch from one subunit is brought to the vicinity of the DEDD center of the second monomer to form a fully functional RNase T active site. In support of this model, mutagenetic studies show that one NBS1 residue, Arg 13 , sits at the catalytic center despite being on the opposite side of the monomer. Second, the complementarity of the RNase T subunits through the formation of homodimers was demonstrated by reconstitution of partial RNase T activity from monomers derived from two inactive mutant proteins, one defective in catalysis and one in substrate binding. These data explain why RNase T must dimerize to function. The model provides a detailed framework on which to explain the mechanism of action of RNase T.RNase T, a DEDD exonuclease, plays an important role in many aspects of stable RNA metabolism (1-6). The enzyme forms a homodimer in vivo, and formation of the homodimer is required for it to function (7). In the companion article (8), RNase T was examined by sequence analysis and site-directed mutagenesis to identify regions of the protein important for catalysis, substrate binding, and dimerization. We showed first that the DEDD signature motifs probably form the RNase T catalytic center. Second, sequence analysis identified several highly conserved, positively charged sequence segments, termed NBS1-3, 1 that are present in all RNase T orthologs, but absent from the closely related proofreading domains/subunits of DNA polymerases, that seem to be involved in the binding of nucleic acid substrates. Finally, we showed that residues at the C terminus of each monomer of RNase T are important for dimerization.Based on this information, additional experiments, and homology modeling, we present here a structural and functional model for RNase T. Based on this model, we show that the NBS segments cluster in the tertiary structure to form a positively charged surface patch suitable for nucleic acid binding. We also propose that the DEDD catalytic center and the NBS are on opposite sides of an RNase T monomer and are brought together to create a complete active site through dimerization. Direct evidence for the complementarity of the two RNase T subunits in the homodimer was obtained by reconstituting partial RNase T activity from two inactive mutants, one an NBS mutant defective in substrate binding and the other a DEDD mutant defective in catalysis. These results explain the requirement for dimerization to generate functional RNase T.