Components of the heterogeneous nuclear ribonucleoprotein (hnRNP) complex and other nucleic acid-binding proteins are subject to methylation on specific arginine residues by the catalytic activity of arginine methyltransferases. The methylation has been implicated in transcriptional regulation and RNA and protein trafficking and signal transduction, but the mechanism by which these functions are achieved has remained undetermined. We show here that the predominant arginine methyltransferase in human cells, protein arginine methyltransferase 1 (PRMT1), is associated with hnRNP complexes, dependent on the methylation status of the cell, and that it methylates its preferred substrates in situ. Binding of PRMT1 occurs through physical interaction with scaffold attachment factor A (SAF-A), also known as hnRNP-U, which is quantitatively methylated by PRMT1 in all investigated cell lines as determined by a novel, highly specific, methylation-sensitive antibody.