Studies of yeast transcription have revealed the widespread distribution of intergenic RNA polymerase II transcripts. These cryptic unstable transcripts (CUTs) are rapidly degraded by the nuclear exosome. Yeast RNA binding proteins Nrd1 and Nab3 direct termination of sn/snoRNAs and recently have also been implicated in premature transcription termination of the NRD1 gene. In this paper, we show that Nrd1 and Nab3 are required for transcription termination of CUTs. In nrd1 and nab3 mutants, we observe 3'-extended transcripts originating from CUT promoters but failing to terminate through the Nrd1- and Nab3-directed pathway. Nrd1 and Nab3 colocalize to regions of the genome expressing antisense CUTs, and these transcripts require yeast nuclear exosome and TRAMP components for degradation. Dissection of a CUT terminator reveals a minimal element sufficient for Nrd1- and Nab3-directed termination. These results suggest that transcription termination of CUTs directed by Nrd1 and Nab3 is a prerequisite for rapid degradation by the nuclear exosome.

The yeast RNA binding proteins Nrd1 and Nab3 are required for termination of nonpolyadenylated transcripts from RNA polymerase (Pol) II-transcribed snRNA and snoRNA genes. In this paper, we show that NRD1 expression is regulated by Nrd1- and Nab3-directed premature termination. Sequences recognized by these proteins are present in NRD1 mRNA and are required for regulated expression. Chromatin immunoprecipitation and transcription run-on experiments show that, in wild-type cells, Pol II occupancy is high at the 5' end of the NRD1 gene and decreases at the 3' end. Mutation of Nrd1 and Nab3 binding sites within the NRD1 mRNA leads to a relative increase in Pol II occupancy of downstream sequences. We further show that NRD1 autoregulation involves components of the exosome and a newly discovered exosome-activating complex. Together, these results show that NRD1 is a eukaryotic cellular gene regulated through premature transcription termination.