We have identified a novel nucleolar protein, Nop5p, that is essential for growth in Saccharomyces cerevisiae. Monoclonal antibodies B47 and 37C12 recognize Nop5p, which has a predicted size of 57 kDa and possesses a KKX repeat motif at its carboxyl terminus. Truncations that removed the KKX motif were functional and localized to the nucleolus, but conferred slow growth at 37 degreesC. Nop5p shows significant sequence homology with yeast Sik1p/Nop56p, and putative homologues in archaebacteria, plants, and human. Depletion of Nop5p in a GAL-NOP5 strain lengthened the doubling time about 5-fold, and selectively reduced steady-state levels of 40 S ribosomal subunits and 18 S rRNA relative to levels of free 60 S subunits and 25 S rRNA. Northern blotting and primer extension analyses showed that Nop5p depletion impairs processing of 35 S pre-rRNA at the A0 and A2 cleavage sites. Nop5p is associated with the small nucleolar RNAs U3, snR13, U14, and U18. Depletion of Nop5p caused the nucleolar protein Nop1p (yeast fibrillarin) to be localized to the nucleus and cytosol. Also, 37C12 co-immunoprecipitated Nop1p. These results suggest that Nop5p functions with Nop1p in the execution of early pre-rRNA processing steps that lead to formation of 18 S rRNA.