Palmitoylation of Hepatitis C Virus NS2 Regulates Its Subcellular Localization and NS2-NS3 Autocleavage

Hepatitis C virus (HCV) nonstructural protein 2 (NS2) is a multifunctional protein implicated in both HCV RNA replication and virus particle assembly. NS2-encoded cysteine protease is responsible for autoprocessing of NS2-NS3 precursor, an essential step in HCV RNA replication. NS2 also promotes HCV particle assembly by recruiting envelope protein 2 (E2) to the virus assembly sites located at the detergent-resistant membranes (DRM). However, the fundamental mechanism regulating multiple functions of NS2 remains unclear. In this study, we discovered that NS2 is palmitoylated at the position 113 cysteine residue (NS2/C113) when expressed by itself in cells and during infectious-HCV replication. Blocking NS2 palmitoylation by introducing an NS2/C113S mutation reduced NS2-NS3 autoprocessing and impaired HCV RNA replication. Replication of the NS2/C113S mutant was restored by inserting an encephalomyocarditis virus (EMCV) internal ribosome entry site (IRES) between NS2 and NS3 to separate the two proteins independently of NS2-mediated autoprocessing. These results suggest that NS2 palmitoylation is critical for HCV RNA replication by promoting NS2-NS3 autoprocessing. The NS2/C113S mutation also impaired infectious-HCV assembly, DRM localization of NS2 and E2, and colocalization of NS2 with Core and endoplasmic reticulum lipid raft-associated protein 2 (Erlin-2). In conclusion, our study revealed that two major functions of NS2 involved in HCV RNA replication and virus assembly, i.e., NS2-NS3 autoprocessing and E2 recruitment to the DRM, are regulated by palmitoylation at NS2/C113. Since S-palmitoylation is reversible, NS2 palmitoylation likely allows NS2 to fine tune both HCV RNA replication and infectious-particle assembly. IMPORTANCE Chronic infection with hepatitis C virus (HCV) is a major cause of severe liver diseases responsible for nearly 400,000 deaths per year. HCV NS2 protein is a multifunctional regulator of HCV replication involved in both viral-genome replication and infectious-virus assembly. However, the underlying mechanism that enables the protein to participate in multiple steps of HCV replication remains unknown. In this study, we discovered that N52 palmitoylation is the master regulator of its multiple functions, including N52-mediated self-cleavage and HCV envelope protein recruitment to the virus assembly sites, which in turn promote HCV RNA replication and infectious-particle assembly, respectively. This newly revealed information suggests that N52 palmitoylation could serve as a promising target to inhibit both HCV RNA replication and virus assembly, representing a new avenue for host-targeting strategies against HCV infection.