C to U editing of apolipoprotein B (apoB) RNA requires a multicomponent holoenzyme complex in which minimal constituents include apobec-1 and apobec-1 complementation factor (ACF). We have examined the predicted functional domains in ACF in binding apoB RNA, interaction with apobec-1, and complementation of RNA editing. We demonstrate that apoB RNA binding and apobec-1-interacting domains are defined by two partially overlapping regions containing the NH 2-terminal RNA recognition motifs of ACF. Both apoB RNA binding and apobec-1 interaction are required for editing complementation activity. ACF is a nuclear protein that upon cotransfection with apobec-1 results in nuclear colocalization and redistribution of apobec-1 from the cytoplasm. ACF constructs with deletions or mutations in the putative nuclear localization signal (NLS) still localize in the nucleus of transfected cells but do not colocalize with apobec-1, the latter remaining pre-dominantly cytoplasmic. These observations suggest that the putative NLS motif in ACF is not responsible for its nucleo-cytoplasmic trafficking. By contrast, protein-protein interaction is important for the nuclear import of apobec-1. Taken together, these data suggest that functional complementation of C to U RNA editing by apobec-1 involves the NH2-terminal 380 residues of ACF.