Yeast SUGI was originally characterized as a transcriptional mediator for the GAL4 transactivator. A similar role in vertebrates was suggested by the ligand-enhanced interaction between mammalian homologues of yeast SUG1 and the ligand-dependent activating domain (AF-2) of nuclear receptors. SUG1 was also shown to be a component of the PA700 regulatory complex of the 26 S proteasome and a member of a large family of putative ATPases. However, no catalytic function has yet been attributed to SUG1. We show here that SUG1 is a 3'-5' DNA helicase whose activity is dependent on an intact ATP binding domain. The sedimentation heterogeneity of mammalian SUG1 suggests that it may be associated with distinct protein complexes and therefore play multiple roles.