All lineages of SARS-CoV-2, the coronavirus responsible for the COVID-19 pandemic, contain mutations between amino acids 199 and 205 in the nucleocapsid (N) protein that are associated with increased infectivity. The effects of these mutations have been difficult to determine because N protein contributes to both viral replication and viral particle assembly during infection. Here, we used single-cycle infection and virus-like particle assays to show that N protein phosphorylation has opposing effects on viral assembly and genome replication. Ancestral SARS-CoV-2 N protein is densely phosphorylated, leading to higher levels of genome replication but 10-fold lower particle assembly compared to evolved variants with low N protein phosphorylation, such as Delta (N:R203M), Iota (N:S202R), and B.1.2 (N:P199L). A new open reading frame encoding a truncated N protein called N*, which occurs in the B.1.1 lineage and subsequent lineages of the Alpha, Gamma, and Omicron variants, supports high levels of both assembly and replication. Our findings help explain the enhanced fitness of viral variants of concern and a potential avenue for continued viral selection.
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