The second step of eukaryotic N-linked glycosylation in endoplasmic reticulum is catalyzed by an UDP-N-acetylglucosamine transferase that is comprised of two subunits, Alg13 and Alg14. The interaction between Alg13 and 14 is crucial for UDP-GlcNAc transferase activity, so formation of the Alg13/14 complex is likely to play a key role in the regulation of N-glycosylation. Using a combination of bioinformatics and molecular biological methods, we have undertaken a functional analysis of yeast Alg13 and Alg14 proteins to elucidate the mechanism of their interaction. Our mutational studies demonstrated that a short C-terminal ␣-helix of Alg13 is required for interaction with Alg14 and for enzyme activity. Electrostatic surface views of the modeled Alg13/14 complex suggest the presence of a hydrophobic cleft in Alg14 that provides a pocket for the Alg13 C-terminal ␣-helix. Co-immunoprecipitation assays confirmed the C-terminal three amino acids of Alg14 are required for maintaining the integrity of Alg13/Alg14 complex, and this depends on their hydrophobicity. Modeling studies place these three Alg14 residues at the entrance of the hydrophobic-binding pocket, suggesting their role in the stabilization of the interaction between the C termini of Alg13 and Alg14. Together, these results demonstrate that formation of this hetero-oligomeric complex is mediated by a short C-terminal ␣-helix of Alg13 in cooperation with the last three amino acids of Alg14. In addition, deletion of the N-terminal -strand of Alg13 caused the destruction of protein, indicating the structural importance of this region in protein stability.