Here we report that bacteriophage T4 RNA ligase 2 (Rnl2) is an efficient catalyst of RNA ligation at a 3 -OH/ 5 -PO 4 nick in a double-stranded RNA or an RNA⅐DNA hybrid. The critical role of the template strand in approximating the reactive 3 -OH and 5 -PO 4 termini is underscored by the drastic reductions in the RNA-sealing activity of Rnl2 when the duplex substrates contain gaps or flaps instead of nicks. RNA nick joining requires ATP and a divalent cation cofactor (either Mg or Mn). Neither dATP, GTP, CTP, nor UTP can substitute for ATP. We identify by alanine scanning seven functionally important amino acids (Tyr-5, Arg-33, Lys-54, Gln-106, Asp-135, Arg-155, and Ser-170) within the N-terminal nucleotidyltransferase domain of Rnl2 and impute specific roles for these residues based on the crystal structure of the AMPbound enzyme. Mutational analysis of 14 conserved residues in the C-terminal domain of Rnl2 identifies 3 amino acids (Arg-266, Asp-292, and Glu-296) as essential for ligase activity. Our findings consolidate the evolutionary connections between bacteriophage Rnl2 and the RNAediting ligases of kinetoplastid protozoa.Bacteriophage T4 encodes two RNA strand-joining enzymes, RNA ligase 1 (Rnl1) 1 and RNA ligase 2 (Rnl2), that exemplify different branches of the RNA ligase family (1). The function of Rnl1 in vivo is to repair a break in the anticodon loop of Escherichia coli tRNA Lys triggered by phage activation of a host-encoded anticodon nuclease (2). Rnl1-like ligases are few in number, and they have a relatively narrow phylogenetic distribution that is limited, as far as we know, to bacteriophages, fungi, and baculoviruses (3-9). T4 Rnl2 typifies a separate branch (1) that includes vibriophage KVP40 Rnl2 (10), the RNA-editing ligases (RELs) of Trypanosoma and Leishmania (11-13) (Fig. 1), putative RNA ligases encoded by certain eukaryotic viruses, and putative RNA ligases encoded by many species of archaea (1). Thus, the Rnl2-like ligases are present in all three phylogenetic domains. The function of T4 Rnl2 during phage infection is unknown.RNA ligases join 3Ј-OH and 5Ј-PO 4 RNA termini through a series of three nucleotidyl transfer steps (3, 14 -16).Step 1 is the reaction of ligase with ATP to form a covalent ligase-(lysyl-N)-AMP intermediate and pyrophosphate. In Step 2, the AMP is transferred from ligase-adenylate to the 5Ј-PO 4 RNA end to form an RNA-adenylate intermediate (AppRNA). In Step 3, attack by an RNA 3Ј-OH on the RNA-adenylate seals the two ends via a phosphodiester bond and releases AMP. Biochemical characterization of T4 and KVP40 Rnl2 revealed an interesting effect of ATP whereby reaction of Rnl2 with a 5Ј-PO 4 singlestranded 18-mer RNA in the presence of ATP resulted in the accumulation of high levels of AppRNA and scant RNA end sealing (1, 17). This ATP-trapping effect is likely caused by dissociation of Rnl2 from newly formed AppRNA, followed immediately by re-adenylylation of Rnl2, which precludes the third step of the strand-joining pathway.The biochemical properties of the ph...