To characterize sequences in the RNA helicase-like PRP2 protein of Saccharomyces cerevisiae that are essential for its function in pre-mRNA splicing, a pool of random PRP2 mutants was generated. A dominant negative allele was isolated which, when overexpressed in a wild-type yeast strain, inhibited cell growth by causing a defect in pre-mRNA splicing. This defect was partially alleviated by simultaneous co-overexpression of wild-type PRP2. The dominant negative PRP2 protein inhibited splicing in vitro and caused the accumulation of stalled splicing complexes. Immunoprecipitation with anti-PRP2 antibodies confirmed that dominant negative PRP2 protein competed with its wild-type counterpart for interaction with spliceosomes, with which the mutant protein remained associated. The PRP2-dn1 mutation led to a single amino acid change within the conserved SAT motif that in the prototype helicase eIF-4A is required for RNA unwinding. Purified dominant negative PRP2 protein had approximately 40% of the wild-type level of RNA-stimulated ATPase activity. As ATPase activity was reduced only slightly, but splicing activity was abolished, we propose that the dominant negative phenotype is due primarily to a defect in the putative RNA helicase activity of PRP2 protein.