The human scavenger decapping enzyme, DcpS, functions to hydrolyze the resulting cap structure following cytoplasmic mRNA decay yet is, surprisingly, a nuclear protein by immunofluorescence. Here, we show that DcpS is a nucleocytoplasmic shuttling protein that contains separable nuclear import and Crm-1-dependent export signals. We postulated that the presence of DcpS in both cellular compartments and its ability to hydrolyze cap structure may impact other cellular events dependent on cap-binding proteins. An shRNA-engineered cell line with markedly diminished DcpS levels led to a corresponding reduction in cap-proximal intron splicing of a reporter minigene and endogenous genes. The impaired cap catabolism and resultant imbalanced cap concentrations were postulated to sequester the cap-binding complex (CBC) from its normal splicing function. In support of this explanation, DcpS efficiently displaced the nuclear cap-binding protein Cbp20 from cap structure, and complementation with Cbp20 reversed the reduced splicing, indicating that modulation of splicing by DcpS is mediated through Cbp20. Our studies demonstrate that the significance of DcpS extends beyond its well-characterized role in mRNA decay and involves a broader range of functions in RNA processing including nuclear pre-mRNA splicing.