Avian reovirus and Nelson Bay reovirus are two unusual nonenveloped viruses that induce extensive cell-cell fusion via expression of a small nonstructural protein, termed p10. We investigated the importance of the transmembrane domain, a conserved membrane-proximal dicysteine motif, and an endodomain basic region in the membrane fusion activity of p10. We now show that the p10 dicysteine motif is palmitoylated and that loss of palmitoylation correlates with a loss of fusion activity. Mutational and functional analyses also revealed that a triglycine motif within the transmembrane domain and the membrane-proximal basic region were essential for p10-mediated membrane fusion. Mutations in any of these three motifs did not influence events upstream of syncytium formation, such as p10 membrane association, protein topology, or surface expression, suggesting that these motifs are more intimately associated with the membrane fusion reaction. These results suggest that the rudimentary p10 fusion protein has evolved a mechanism of inducing membrane merger that is highly dependent on the specific interaction of several different motifs with donor membranes. In addition, cross-linking, coimmunoprecipitation, and complementation assays provided no evidence for p10 homo- or heteromultimer formation, suggesting that p10 may be the first example of a membrane fusion protein that does not form stable, higher-order multimers.