Almost all transfer RNA molecules sequenced so far contain two universal modified nucleosides at positions 54 and 55, respectively: ribothymidine (T54) and pseudouridine (psi 55). To identify the tRNA elements recognized by tRNA:m5uridine-54 methyltransferase and tRNA:pseudouridine-55 synthase from the yeast Saccharomyces cerevisiae, a set of 43 yeast tRNA(Asp) mutants were used. Some variants contained point mutations, while the others included progressive reductions in size down to a tRNA minisubstrate consisting of the T psi-loop with only one G.C base-pair as stem (9-mer). All substrates (full-sized tRNA(Asp) and various minihelices) were produced in vitro by T7 transcription and tested using yeast extract (S100) as a source of enzymatic activities and S-adenosyl-L-methionine as a methyl donor. The results indicate that the minimal substrate for enzymatic formation of psi 55 is a stem/loop structure with only four G.C base-pairs in the stem, while a longer stem is required for efficient T54 formation. None of the conserved nucleotides (G53, C56, A58 and C61) and U54 for psi 55 or U55 for T54 formation can be replaced by any of the other three canonical nucleotides. Yeast tRNA:m5uridine-54 methyltransferase additionally requires the presence of a pyrimidine-60 in the loop. Interestingly, in a tRNA(Asp) variant in which the T psi-loop was permuted with the anticodon-loop, the new U32 and U33 residues derived from the T psi-loop were quantitatively converted to T32 and psi 33, respectively. Structural mapping of this variant with ethylnitrosourea confirmed that the intrinsic characteristic structure of the T psi-loop was conserved upon permutation and that the displaced anticodon-loop did not acquire a T psi-loop structure. These results demonstrate that a local conformation rather than the exact location of the U-U sequence within the tRNA architecture is the important identity determinant for recognition by yeast tRNA:m5uridine-54 methyltransferase and tRNA:pseudouridine-55 synthase.