In eukaryotic cells, several mRNAs including those of c-myc and c-fos are localized to the perinuclear cytoplasm and associated with the cytoskeleton. The localization element of c-myc mRNA is present within its 3'UTR (3'-untranslated region) but the precise nature of this signal has remained unidentified. Chemical/enzymatic cleavage with RNases (ribonucleases) and lead have identified single-stranded and double-stranded regions in RNA transcripts of nucleotides 194-280 of the c-myc YUTR. Combined with computer predicted structure these results indicate that this region folds so that part of it forms a stem-loop structure. A mutation, that has been previously shown to prevent localization, leads to a different secondary RNA structure in this region as indicated by altered cleavage patterns. Competitive gel-retardation assays, using labelled transcripts corresponding to nucleotides 205-280 of c-myc YUTR, and fibroblast extracts revealed that the stem-loop region was sufficient for wRNA-protein complex formation. In situ hybridization studies in cells transfected with reporter constructs, in which all or parts of the region corresponding to this stem-loop were linked to beta-globin, indicated that this region was sufficient for localization and that deletion of the nucleotides corresponding to the proposed upper-stem or terminal loop prevented localization. Our hypothesis is that an AU-rich stem-loop structure within nt 222-267 in the c-myc YUTR forms the perinuclear localization signal. Bioinformatic analysis suggests that this signal shares features with YUTRs of other localized mRNAs and that these features may represent a conserved form of signal in mRNA localization mechanisms. Key words: c-myc, mRNA localization signal, 3'untranslated region (3'UTR), RNA secondary structure, perinuclear localization, trafficking.