The Sec61 protein translocation complex in the endoplasmic reticulum (ER) membrane is composed of three subunits. The alpha-subunit, called Sec61p in yeast, is a multispanning membrane protein that forms the protein conducting channel. The functions of the smaller, carboxyl-terminally tail-anchored beta subunit Sbh1p, its close homologue Sbh2p, and the gamma subunit Sss1p are not well understood. Here we show that co-translational protein translocation into the ER is reduced in sbh1Delta sbh2Delta cells, whereas there is a limited reduction of post-translational translocation and no effect on export of a mutant form of alpha-factor precursor for ER-associated degradation in the cytosol. The translocation defect and the temperature-sensitive growth phenotype of sbh1Delta sbh2Delta cells were rescued by expression of the transmembrane domain of Sbh1p alone, and the Sbh1p transmembrane domain was sufficient for coimmunoprecipitation with Sec61p and Sss1p. Furthermore, we show that Sbh1p co-precipitates with the ER transmembrane protein Rtn1p. Sbh1p-Rtn1p complexes do not appear to contain Sss1p and Sec61p. Our results define the transmembrane domain as the minimal functional domain of the Sec61beta homologue Sbh1p in ER translocation, identify a novel interaction partner for Shb1p, and imply that Sbh1p has additional functions that are not directly linked to protein translocation in association with the Sec61 complex.