Yeast tRNA ligase possesses multiple activities which are required for the joining of tRNA halves during the tRNA splicing process: cyclic phosphodiesterase, kinase, adenylylate synthetase, and ligase. A deletion polypeptide of a dihydrofolate reductase-ligase fusion protein, designated DAC, was previously shown to join tRNA halves although ATP-dependent kinase activity was not measurable in the assay used. We describe here a characterization of the mechanism of joining used by DAC and the structure of the tRNA product. DAC produces a joined tRNA and a splice junction with a structure identical to that produced by DAKC, the full-length dihydrofolate reductase-ligase fusion. Furthermore, DAC can use GTP as the sole cofactor in the joining reaction, in contrast to DAKC, which can only complete splicing in the presence of ATP. Both enzymes exhibit GTP-dependent kinase activity at 100-fold greater efficiency than with ATP. These results suggest that a potential function for the center domain of tRNA ligase (missing in DAC) is to provide structural integrity and aid in substrate interactions and specificity. They also support the hypothesis that ligase may prefer to use two different cofactors during tRNA splicing.