Rbp1p, a yeast RNA-binding protein, decreases the level of mitochondrial porin mRNA by enhancing its degradation, but the intracellular location of the Rbp1p-mediated degradation complex remains unknown. We show here that Rbp1p in xrn1Delta mutant yeast localizes in specific cytoplasmic foci that are known as P-bodies. The N-terminal and RNA recognition motif (RRM) 1 domains of Rbp1p are necessary but not sufficient for its localization in P bodies. Rbp1p forms oligomers through its C-terminal domain in vivo; N-terminal-delete, or RRM1-mutated Rbp1p can be more efficiently recruited to P-bodies in an xrn1Delta strain, expressing a full-length Rbp1p. Although POR1 mRNA is localized to P bodies in an xrn1Delta strain, this localization does not depend on Rbp1p. Decapping activator Dhh1p directly interacts with Rbp1p. However, the recruitment of Rbp1p to P-bodies does not require Dhh1p or Ccr4p. In wild-type cells, Rbp1p can localize to P-bodies under glucose deprivation or treatment with KCl. In addition, Rbp1p-mediated porin mRNA decay is elicited by Xrn1p, a 5 ' to 3 ' exonuclease. These results provide new insight into the mechanism of Rbp1p function.