U3 small nucleolar RNA (snoRNA) is a member of the Box C/D family of snoRNAs which functions in ribosomal RNA processing. U3-55k is a protein that has been found to interact with U3 but not other members of the Box C/D snoRNA family. We have found that interaction of the U3-55k protein with U3 RNA in vivo is mediated by the conserved Box B/C motif which is unique to U3 snoRNA. Mutation of Box B and Box C, but not of other conserved sequence elements, disrupted interaction of U3-55k with U3 RNA. Furthermore, a fragment of U3 containing only these two conserved elements was bound by U3-55k in vivo. RNA binding assays performed in vitro indicate that Box C may be the primary determinant of the interaction. We have cloned the cDNA encoding the Xenopus laevis U3-55k protein and find strong homology to the human sequence, including six WD repeats. Deletion of WD repeats or sequences near the C-terminus of U3-55k resulted in loss of association with U3 RNA and also loss of localization of U3-55k to the nucleolus, suggesting that protein-protein interactions contribute to the localization and RNA binding of U3-55k in vivo.