The properties of a mutant hammerhead ribozyme system, which consists of two RNA oligomer strands and in which stem II is deleted (replaced with a UUUU loop), are described. The effects of temperature, pH, and metal ions on the cleavage reaction were similar to those for the parent ribozyme with stem II. The mutant ribozyme showed a much lower cleavage rate (kcat = 0.04 min-1) in the presence of 10 mM MgCl2, where the parent ribozyme showed full cleavage activity. However, increasing the concentration of MgCl2 from 10 to 100 mM restored the cleavage activity of the mutant ribozyme to the original level (kcat = 0.2 min-1). CD titration experiments with MgCl2 using a noncleavable substrate were carried out. Deletion of stem II resulted in an about 20-fold reduction of the apparent Mg2+ binding affinity when the Mg2+ concentrations of half-saturation are compared. The results were analyzed by curve-fitting analysis and compared with those for the parent ribozyme. The analysis showed that the Mg2+ concentration dependence data in CD and cleavage experiments for the mutant enzyme can be explained by a two Mg2+ ion binding mechanism. These results that stem II is important for maintaining the conformation of the catalytic core suitable for Mg2+ binding.