The yeast NMD3 gene was identified in a two-hybrid screen using the nonsense-mediated mRNA decay factor, Upf1p, as bait. NMD3 was shown to encode an essential, highly conserved protein that associated principally with free 60S ribosomal subunits. Overexpression of a truncated form of Nmd3p, lacking 100 C-terminal amino acids and most of its Upf1p-interacting domain, had dominant-negative effects on both cell growth and protein synthesis and promoted the formation of polyribosome half-mers. These effects were eliminated by truncation of an additional 100 amino acids from Nmd3p. Overexpression of the nmd3Δ100 allele also led to increased synthesis and destabilization of some ribosomal protein mRNAs, and increased synthesis and altered processing of 35S pre-rRNA. Our data suggest that Nmd3p has a role in the formation, function, or maintenance of the 60S ribosomal subunit and may provide a link for Upf1p to 80S monosomes.