There is accumulating evidence to indicate that the regulation of subnuclear compartmentalization plays important roles in cellular processes. The RNA polymerase I-associated factor PAF49 has been shown to accumulate in the nucleolus in growing cells, but disperse into the nucleoplasm in growth-arrested cells. Serial deletion analysis revealed that amino acids 199–338 were necessary for the nucleolar localization of PAF49. Combinatorial point mutation analysis indicated that the individual basic amino acid stretches (BS) within the central (BS1-4) and the C-terminal (BS5 and 6) regions may cooperatively confer the nucleolar localization of PAF49. Addition of the basic stretches in tandem to a heterologous protein, such as the interferon regulatory factor-3, translocated the tagged protein into the nucleolus, even in the presence of an intrinsic nuclear export sequence. Thus, tandem array of the basic amino acid stretches identified here functions as a dominant nucleolar targeting sequence.