The Saccharomyces cerevisiae DBR1 gene encodes a 2-5 phosphodiesterase that debranches intron RNA lariats following splicing. Yeast dbr1 mutants accumulate intron lariats and are also defective for mobility of the retrotransposons Ty1 and Ty3. We used a mutagenic PCR method to generate a collection of dbr1 mutant alleles to explore the relationship between the roles of DBR1 in transposition and debranching. Eight mutants defective for Ty1 transposition contained single amino acid changes in Dbr1p. Two mutations, G84A and N85D, are in a conserved phosphoesterase motif that is believed to be part of the active site of the enzyme, supporting a connection between enzymatic activity and Ty1 transposition. Two other mutations, Y68F and Y68D, occur at a potential phosphorylation site, and we have shown that Dbr1p is phosphorylated on tyrosine. We have developed an RNase protection assay to quantitate intron RNA accumulation in cells. The assay uses RNA probes that hybridize to ACT1 intron RNA. Protection patterns confirm that sequences from the 5 end of the intron to the lariat branch point accumulate in dbr1 mutants in a branched (lariat) conformation. RNase protection assays indicate that all of the newly generated dbr1 mutant alleles are also deficient for debranching, further supporting a role for 2-5 phosphodiesterase activity in Ty1 transposition. A Ty1 element lacking most of its internal sequences transposes independently of DBR1. The existence of Dbr1p-dependent Ty1 sequences raises the possibility that Dbr1p acts on Ty1 RNA.Saccharomyces cerevisiae Ty1 is a long terminal repeat (LTR) retroelement with a life cycle similar to that of retroviruses (2). Like retroviruses, Ty1 replicates via reverse transcription of an RNA intermediate, subsequently integrating element cDNA into the host genome. Retroviruses and LTR retrotransposons rely on their hosts to provide most of the factors necessary for propagation. We identified dbr1 mutants in a screen to identify host cell genes required for Ty1 transposition (15). The dbr1 mutant had been identified previously in a similar screen by others (6). Although dbr1 cells produce wild-type levels of Ty1 proteins, they accumulate Ty1 cDNA at a slower rate than do wild-type cells, suggesting that Dbr1p plays a role in Ty1 reverse transcription or cDNA stability (15).In its cellular role, Dbr1p acts at the end of the mRNA splicing process, cleaving the 2Ј-5Ј linkage at the branch point of intron RNA lariats released after exon ligation, converting them to linear RNAs that are rapidly degraded (6, 23). In a dbr1 mutant, intron RNAs accumulate as lariats (6). The uncleaved lariat branch point blocks the progression of 3Ј exonucleases, and there is no 5Ј end available on which a 5Ј exonuclease can act. DBR1 is highly conserved, and homologues have been cloned from Schizosaccharomyces pombe, S. cerevisiae, Caenorhabditis elegans, Drosophila melanogaster, Mus musculus, and Homo sapiens (6,17,18,24). Deletion of DBR1 has no significant effect on the growth rate of S. cerevisiae, but...