The protein Sam68 (Src-associated in mitosis, 68 kDa) has been found to bind to SH2 and to SH3 domain-containing proteins and to RNA. Although its protein-protein interactions implicate Sam68 in cell signaling, the significance of its RNA binding remains obscure. In most cells, Sam68 shows diffuse nucleoplasmic staining. Upon treatment with transcription inhibitors, however, Sam68 localize into punctate nuclear structures. Mutant forms of mouse Sam68 were overexpressed in human cells to test the importance of the KH domain, which is required for RNA binding, in the intracellular localization of Sam68. A small deletion within the KH domain (delta 206-218) or point mutation I184N had no effect upon the localization of overexpressed Sam68. Sam68 that contained a deletion of the entire KH domain (delta KH, delta 157-256) or point mutation G178E, however, localized to distinct nuclear spots. Furthermore, delta KH Sam68, unlike wild-type Sam68 and several other mutant Sam68 proteins, did not relocalize upon poliovirus infection and caused the normally cytoplasmic viral polymerase to localize to the nuclear spots. Thus both ongoing transcription and an intact KH domain are crucial determinants of the dynamic intracellular localization of Sam68.