Human T-cell leukemia virus (HTLV-I, HTLV-II) rex protein function is required for the cytoplasmic expression of incompletely spliced viral transcripts encoding structural proteins. The effect is mediated by a cis-acting rex-response element (RRX) which is located near the 3' end of all viral mRNAs. We show that rex polypeptides of HTLV-I and HTLV-II expressed in Escherichia coli are capable of specifically binding RRX-containing transcripts of both viruses in cell-free assays. Binding analyses with deletion variants of rex proteins revealed a domain with RNA-binding activity in the first 77 N-terminal amino acids. Removal of a basic peptide of 19 amino acids from the N terminus abrogated RNA binding, whereas a beta-galactosidase fusion protein containing this peptide bound to the RRX. These results suggest that direct binding of rex protein to the RRX is important for rex-mediated regulation of viral gene expression and that a short stretch of positively charged amino acids contributes to the specific binding of rex to its target RNA.