The Epstein-Barr virus (EBV) SM protein is a posttranscriptional regulator of viral gene expression. Like many transactivators encoded by herpesviruses, SM transports predominantly unspliced viral mRNA cargo from the nucleus to the cytosol, where it is subsequently translated. This activity likely involves a region of the protein that has homology to the herpes simplex virus type 1 (HSV-1) ICP27 gene product, the first member of this class of regulators to be discovered. However, SM also contains a repetitive segment rich in arginine and proline residues that is dispensable for its effects on RNA transport and splicing. This portion of SM, comprised of RXP triplet repeats, shows homology to the carboxyl-terminal domain of Us11, a double-stranded RNA (dsRNA) binding protein encoded by HSV-1 that inhibits activation of the cellular PKR kinase. To evaluate the intrinsic ability of SM to regulate PKR, we expressed and purified several SM protein derivatives and examined their activity in a variety of biochemical assays. The full-length SM protein bound dsRNA, associated physically with PKR, and prevented PKR activation. Removal of the 37-residue RXP domain significantly compromised all of these activities. Furthermore, the SM RXP domain was itself sufficient to inhibit PKR activation and interact with the kinase. Relative to its Us11 counterpart, the SM RXP segment bound dsRNA with reduced affinity and responded differently to single-stranded competitor polynucleotides. Thus, SM represents the first EBV gene product expressed during the lytic cycle that can prevent PKR activation. In addition, the RXP repeat segment appears to be a conserved herpesvirus motif capable of associating with dsRNA and modulating activation of the PKR kinase, a molecule important for the control of translation and the cellular antiviral response.Early in the course of a lytic infection, Epstein-Barr virus (EBV) expresses a polypeptide 479 amino acids in length known as SM, Mta, or EB2 that regulates viral gene expression posttranscriptionally (9, 13, 29). The SM polypeptide, encoded by a spliced mRNA that joins the BSLF2 and BMLF1 open reading frames, can transactivate reporter gene expression in a promoter-independent, gene-specific fashion in transienttransfection assays (4,9,25,29,41,42). In addition, SM has been reported to bind RNA, shuttle into and out of the nucleus, inhibit expression of intron-containing genes, and activate expression of genes that lack introns (2,3,8,13,18,41,42,45). Many EBV genes important for viral replication in productively infected cells do not contain introns, and the cytoplasmic accumulation of their mRNAs is regulated by SM, as are cytoplasmic levels of mRNAs transcribed from reporter genes that do not contain introns (13,26,45). Other studies, however, provide evidence that SM inhibits splicing of precursors containing weak 5Ј splice site consensus sequences and mediates their accumulation in the cytosol (3,18,45). Finally, SM associates with the cellular SC35 splicing factor (8,26,45