This work investigated whether the Escherichia coli RNase III gene, rnc+, could complement vp1080, a mutant vaccinia virus that is deleted of its E3L gene. Like E3L, rnc+ codes for a dsRNA binding protein that contains an additional nucleolytic activity. Rnc genes were cloned into the eukaryotic expression vector pMTVa-, expressed in COS-1 cells, and shown to be functional. Transient rescue experiments in HeLa cells demonstrated that the cleavage function of the rnc+ gene was necessary for full rescue of vp1080. The rnc 70 gene, which encodes a product deficient in catalytic activity but still capable of binding to dsRNA, rescued vp1080 weakly. The rnc 105 gene, which encodes a product that cannot bind or cleave dsRNA, was unable to rescue vp1080. The rnc genes were also inserted into the E3L locus of vp1080. While recombinants containing the rnc+ gene or the rnc 70 gene regained the IFN resistance phenotype in RK13 cells, full host range of vaccinia virus was only restored in the recombinant containing the rnc+ gene. Thus, the ability of RNase III to process dsRNA appears to be necessary to restore the host range phenotype. The vp-rnc 105 recombinant behaved similarly to vp1080.