The mouse hepatitis virus (MHV) genome's 3' untranslated region contains cis-acting sequences necessary for replication. Studies of MHV and other coronaviruses have indicated a role for RNA secondary and tertiary elements in replication. Previous work in our laboratory has identified four proteins which form ribonucleoprotein complexes with the 3'-terminal 42 nucleotides [3'(+)42] of the MHV genome. Defective interfering (DI) RNA replication assays have demonstrated a role for the 3'(+)42 host protein binding element in the MHV life cycle. Using gel mobility shift RNase T1 protection assays and secondary structure modeling, we have characterized a possible role for RNA secondary structure in host protein binding to the 3'-terminal 42-nucleotide element. Additionally we have identified a role for the 3'-terminal 42-nucleotide host protein binding element in RNA replication and transcription using DI RNA replication assays and targeted recombination and by directly constructing mutants in this protein binding element using a recently described MHV reverse genetic system. DI RNA replication assays demonstrated that mutations in the 3'(+)42 host protein binding element had a deleterious effect on the accumulation of DI RNA. When the identical mutations were directly inserted into the MHV genome, most mutant genomes were viable but formed smaller plaques than the wild-type parent virus. One mutant was not viable. This mutant directed the synthesis of genome-sized negative-sense RNA approximately as efficiently as the wild type did but had a defect in subgenomic mRNA synthesis. These results point to a potential role for sequences at the extreme 3' end of the MHV genome in subgenomic RNA synthesis.