KS-Bcl-2, encoded by Kaposi's sarcoma-associated herpesvirus (KSHV), is a structural and functional homologue of the Bcl-2 family of apoptosis regulators. Like several other Bcl-2 family members, KS-Bcl-2 protects cells from apoptosis and autophagy. Using a yeast two-hybrid screen and coimmunoprecipitation assays, we identified a novel KS-Bcl-2-interacting protein, referred to as protein interacting with carboxyl terminus 1 (PICT-1), encoded by a candidate tumor suppressor gene, GLTSCR2. Confocal laser scanning microscopy revealed nucleolar localization of PICT-1, whereas KS-Bcl-2 was located mostly at the mitochondrial membranes with a small fraction in the nucleoli. Ectopic expression of PICT-1 resulted in a large increase in the nucleolar fraction of KS-Bcl-2, and only a minor fraction remained in the cytoplasm. Furthermore, knockdown of endogenous PICT-1 abolished the nucleolar localization of KS-Bcl-2. However, ectopically expressed PICT-1 did not alter the cellular distribution of human Bcl-2. Subsequent analysis mapped the crucial amino acid sequences of both KS-Bcl-2 and PICT-1 required for their interaction and for KS-Bcl-2 targeting to the nucleolus. Functional studies suggest a correlation between nucleolar targeting of KS-Bcl-2 by PICT-1 and reduction of the antiapoptotic activity of KS-Bcl-2. Thus, these studies demonstrate a cellular mechanism to sequester KS-Bcl-2 from the mitochondria and to downregulate its virally encoded antiapoptotic activity. Additional characterization of the interaction of KS-Bcl-2 and PICT-1 is likely to shed light on the functions of both proteins.