TLS (FUS) and the related gene EWS encode the N-terminal portion of many fusion oncoproteins involved in human sarcomas and leukemia. TLS is an RNA-binding nuclear protein that is identical to hnRNP P2 and may be implicated in mRNA metabolism. When RNA polymerase II is inhibited, TLS immunostaining in the nucleus is dramatically altered, from its normal diffuse nucleoplasmic pattern to accumulation in dense nuclease-resistant aggregates. Co-immunostaining with antibodies to fibrillarin or p80 coilin and immunoelectron microscopy revealed that the TLS aggregates are associated with the nucleolus and are distinct from other known structures such as the coiled body or the interchromatin granule. Injection of cells with an oligodeoxynucleotide that disrupts splicing does not result in redistribution of TLS, indicating that the event is specific to inhibition of transcription. Oncoproteins that contain the N-terminal domain from either TLS, EWS or their Drosophila homologue, SARFH (CAZ), are also targeted to the same structure. These findings suggest a correlation between the topogenic and transforming activities of TLS and EWS N-termini and imply the existence of cellular targets that are shared by the germ-line encoded proteins and their oncogenic derivatives.