Depletion of any of the essential Lsm proteins, Lsm2-5p or Lsm8p, delayed pre-rRNA processing and led to the accumulation of many aberrant processing intermediates, indicating that an Lsm complex is required to maintain the normally strict order of processing events. In addition, high levels of degradation products derived from both precursors and mature rRNAs accumulated in Lsm-depleted strains. Depletion of the essential Lsm proteins reduced the apparent processivity of both 5 and 3 exonuclease activities involved in 5.8S rRNA processing, and the degradation intermediates that accumulated were consistent with inefficient 5 and 3 degradation. Many, but not all, pre-rRNA species could be coprecipitated with tagged Lsm3p, but not with tagged Lsm1p or non-tagged control strains, suggesting their direct interaction with an Lsm2-8p complex. We propose that Lsm proteins facilitate RNA protein interactions and structural changes required during ribosomal subunit assembly.The yeast 18S, 5.8S, and 25S rRNAs are transcribed by RNA polymerase I as a single precursor, the 35S pre-rRNA, which undergoes complex post-transcriptional processing to remove the external transcribed spacers (5Ј-ETS and 3Ј-ETS) 1 and internal transcribed spacers (ITS1 and ITS2) to release mature rRNAs (see Fig. 1A). This process involves multiple endonucleolytic and exonucleolytic steps (see Fig. 1B) and is largely carried out in the nucleolus. In Saccharomyces cerevisiae, enzymes directly involved in these reactions include the endonucleases RNase MRP and Rnt1p, the 5Ј 3 3Ј exonuclease Rat1p, and 3Ј 3 5Ј exonucleases, including the exosome complex, Rex1p, and Rex2p (1, 2; reviewed in Refs. 3 and 4). In addition to the RNA processing enzymes, around 110 other factors are known to be required for normal pre-rRNA processing in yeast. These include several small nucleolar ribonucleoprotein (snoRNP) particles, putative RNA helicases, GTPases, and many other assembly factors (5). It is very likely that these act to promote correct folding of the pre-rRNA, assembly of the ϳ80 ribosomal proteins, and assembly/disassembly of the processing complexes, with processing inhibition arising as a secondary consequence of defects in the structure of the preribosomal particles (see Refs. 3 and 4).All of the enzymes known to process the pre-rRNA also process other RNA species. Rnt1p, the exosome, and Rex proteins generate the 3Ј-ends of small nuclear and small nucleolar RNAs (snRNAs and snoRNAs), whereas Xrn1p and Rat1p produce 5Ј-ends of intron-encoded and polycistronic snoRNAs (2, 6 -13). Likewise, degradation of many RNAs, including cytoplasmic messenger RNAs (mRNAs) and nuclear pre-mRNAs, involves pre-rRNA processing exonucleases: the exosome, Xrn1p, and Rat1p (14 -18).Sm-like (Lsm) proteins have been identified in all kingdoms of life and participate in numerous RNA processing and degradation pathways. The Sm and Lsm complexes are all likely to form similar structures with seven-membered rings (or six in the case of Escherichia coli Hfq) with a central hole, th...