Eukaryotic cells target mRNAs to the nonsense-mediated mRNA decay (NMD) pathway when translation terminates within the coding region. In mammalian cells, this is presumably due to a downstream signal deposited during pre-mRNA splicing. In contrast, unspliced retroviral RNA undergoes NMD in chicken cells when premature termination codons (PTCs) are present in the gag gene. Surprisingly, deletion of a 401-nt 3' UTR sequence immediately downstream of the normal gag termination codon caused this termination event to be recognized as premature. We termed this 3' UTR region the Rous sarcoma virus (RSV) stability element (RSE). The RSE also stabilized the viral RNA when placed immediately downstream of a PTC in the gag gene. Deletion analysis of the RSE indicated a smaller functional element. We conclude that this 3' UTR sequence stabilizes termination codons in the RSV RNA, and termination codons not associated with such an RSE sequence undergo NMD.