During conventional mRNA cap formation, two separate methyltransferases sequentially modify the cap structure, first at the guanine-N-7 (G-N-7) position and subsequently at the ribose 2′-O position. For vesicular stomatitis virus (VSV), a prototype of the nonsegmented negative-strand RNA viruses, the two methylase activities share a binding site for the methyl donor S-adenosyl-L-methionine and are inhibited by individual amino acid substitutions within the C-terminal domain of the large (L) polymerase protein. This led to the suggestion that a single methylase domain functions for both 2′-O and G-N-7 methylations. Here we report a trans-methylation assay that recapitulates both ribose 2′-O and G-N-7 modifications by using purified recombinant L and in vitro-synthesized RNA. Using this assay, we demonstrate that VSV L typically modifies the 2′-O position of the cap prior to the G-N-7 position and that G-N-7 methylation is diminished by pre-2′-O methylation of the substrate RNA. Amino acid substitutions in the C terminus of L that prevent all cap methylation in recombinant VSV (rVSV) partially retain the ability to G-N-7 methylate a pre-2′-O-methylated RNA, therefore uncoupling the effect of substitutions in the C terminus of the L protein on the two methylations. In addition, we show that the 2′-O and G-N-7 methylase activities act specifically on RNA substrates that contain the conserved elements of a VSV mRNA start at the 5′ terminus. This study provides new mechanistic insights into the mRNA cap methylase activities of VSV L, demonstrates that 2′-O methylation precedes and facilitates subsequent G-N-7 methylation, and reveals an RNA sequence and length requirement for the two methylase activities. We propose a model of regulation of the activity of the C terminus of L protein in 2′-O and G-N-7 methylation of the cap structure.