Ribonuclease P (RNase P) contains a catalytic RNA that cleaves precursor tRNA (pre-tRNA) to form the mature 5'-end of tRNA. Previous kinetic analyses with mutant pre-tRNAs indicated that both C residues of the invariant 3'-terminal CCA form specific interactions with RNase P RNA that contribute to the energetics of substrate binding (1, 2). In the present study, we have used single-turnover kinetic analysis to investigate whether specific changes in the 3'-terminal CCA influence the rate of the chemical step through which enzyme-bound substrate is converted to product (k2). At optimal ionic strength (1.0 M NH4Cl, 25 mM MgCl2), deletion or substitution of the 3'-proximal C residue (CCA) reduced the rate of the chemical step of cleavage (k2) by 60-fold. Similar changes to the 5'-proximal C residue (CCA) or the 3'-terminal A residue (CCA) reduced k2 only a few fold. Each mutant substrate exhibited weakened affinity for Mg2+, as measured by Hill plots, and the severity of these defects correlated with the observed reductions in k2. Furthermore, elevated concentrations of Mg2+ partially, but not completely, suppress the k2 defects caused by deletion or substitution of the 3'-proximal C residue. We conclude that the 3'-CCA of pre-tRNA, particularly the 3'-proximal C residue, comprises part of the catalytic pocket formed in the pre-tRNA-RNase P complex and participates in the binding of Mg2+ ions that are essential for catalysis by RNase P RNA.