Project Summary The 5'-3' exoribonucleases (XRNs) comprise a family of conserved enzymes in eukaryotes with important functions in RNA metabolism and RNA interference, including quality control, degradation, transport, maturation of ribosomal and small nucleolar RNAs, and transcription termination of RNA polymerases I and II (Pol I and Pol II). In fungi and animals, XRN1 (175 kD) is primarily cytosolic and is involved in degradation of decapped mRNAs, nonsense mediated decay, microRNA decay and is essential for proper development. XRN2 (115 kD) is primarily nuclear, and its ortholog in S. cerevisiae is more commonly known as Rat1. XRN2/Rat1 is also central to the torpedo model of transcription termination by Pol II and Pol I. In yeast, RAT1 is an essential gene, and deletion of XRN1 leads to slow growth and many other defects. Rat1 co-purifies with another protein, Rai1 (45 kD), which enhances the exoribonuclease activity of Rat1 by ~50% in vitro. A weak sequence homolog of Rai1, known as Dom3Z, exists in mammals, although it does not interact with XRN2. In addition, S. cerevisiae contains a weak Rai1 homolog, Ydr370C, but it has no effect on Rat1 activity. To begin to understand the molecular basis for the functions of these exonucleases, we have determined the crystal structures of the S. pombe Rat1-Rai1 complex and K. lactis Xrn1, and carried out biochemical and functional studies based on the structural information. To our surprise, the crystal structure suggested that Rai1 is an enzyme, and our biochemical studies confirmed that it has RNA 5' pyrophosphohydrolase (PPH) activity and decapping activity (but only toward unmethylated caps). Our further studies showed that Dom3Z has PPH, decapping, and distributive 5'-3' exoribonuclease activity, and we have renamed it DXO. Therefore, we have identified a new 5'-3' exonuclease in mammals. We also found that Ydr370C has decapping and 5'-3' exonuclease activities but no PPH activity, and have named it Dxo1. We hypothesized based on these biochemical activities that the DXO family enzymes have important roles in RNA 5' capping quality control. Our preliminary functional studies in yeast and mammalian cells have demonstrated the existence of incomplete mRNA 5' capping, in contrast to previous beliefs in the field, and the importance of the DXO family enzymes in clearing such RNAs from the cell. These preliminary structural, biochemical and functional studies have set the stage for further characterizations of the classical XRNs as well as the DXO family enzymes.