The Pab1p-dependent poly(A) nuclease (PAN) from Saccharomyces cerevisiae copurifies with polypeptides of approximately 127 and 76 kDa. Previously, it was demonstrated that the 127-kDa Pan2 protein is required for PAN activity (R. Boeck, S. Tarun, M. Reiger, J. Deardorff, S. Müller-Auer, and A.B. Sachs, J. Biol. Chem. 271:432-438, 1996). Here we demonstrate that the 76-kDa protein, encoded by the nonessential PAN3 gene, is also required for enzymatic activity. Deletion of PAN3 resulted in the loss of PAN activity in yeast extracts, and immunodepletion of Pan3p from purified PAN fractions abolished enzymatic activity. We show by coimmunoprecipitation and directed two-hybrid studies that the Pan2 and Pan3 proteins physically interact. In addition, we demonstrate that a deletion of PAN2, PAN3, or both resulted in similar increases in mRNA poly(A) tail lengths in vivo. These data strongly suggest that both Pan2p and Pan3p are required subunits of the PAN enzyme and that PAN functions in vivo to shorten mRNA poly(A) tails.