Using in vivo fidelity assays in which bacterial beta-galactosidase or green fluorescent protein genes served as reporters of mutations, we have identified a murine leukemia virus (MLV) RNase H mutant (Y586F) that exhibited an increase in the retroviral mutation rate approximately 5-fold in a single replication cycle. DNA-sequencing analysis indicated that the Y586F mutation increased the frequency of substitution mutations 17-fold within 18 nt of adenine-thymine tracts (AAAA, TTTT, or AATT), which are known to induce DNA bending. Sequence alignments indicate that MLV Y586 is equivalent to HIV-1 Y501, a component of the recently described RNase H primer grip domain, which contacts and positions the DNA primer strand near the RNase H active site. The results suggest that wild-type reverse transcriptase (RT) facilitates a specific conformation of the template-primer duplex at the polymerase active site that is important for accuracy of DNA synthesis; when an adenine-thymine tract is within 18 nt of the polymerase active site, the Y586F mutant RT cannot facilitate this specific template-primer conformation, leading to an increase in the frequency of substitution mutations. These findings indicate that the RNase H primer grip can affect the template-primer conformation at the polymerase active site and that the MLV Y586 residue and template-primer conformation are important determinants of RT fidelity.