Abstract: Yeast U5 small nuclear ribonucleoprotein particle (snRNP) is assembled via a cytoplasmic precursor that contains the U5-specific Prp8 protein but lacks the U5-specific Brr2 helicase. Instead, pre-U5 snRNP includes the Aar2 protein not found in mature U5 snRNP or spliceosomes. Aar2p and Brr2p bind competitively to a C-terminal region of Prp8p that comprises consecutive RNase H-like and Jab1/MPN-like domains. To elucidate the molecular basis for this competition, we determined the crystal structure of Aar2p in complex with the Prp8p RNase H and Jab1/MPN domains. Aar2p binds on one side of the RNase H domain and extends its C terminus to the other side, where the Jab1/MPN domain is docked onto a composite Aar2p-RNase H platform. Known Brr2p interaction sites of the Jab1/MPN domain remain available, suggesting that Aar2p-mediated compaction of the Prp8p domains sterically interferes with Brr2p binding. Moreover, Aar2p occupies known RNA-binding sites of the RNase H domain, and Aar2p interferes with binding of U4/U6 di-snRNA to the Prp8p C-terminal region. Structural and functional analyses of phospho-mimetic mutations reveal how phosphorylation reduces affinity of Aar2p for Prp8p and allows Brr2p and U4/U6 binding. Our results show how Aar2p regulates both protein and RNA binding to Prp8p during U5 snRNP assembly.