Amino acid sequence alignment was used to identify the putative thumb subdomain of reverse transcriptase (RT) from the Saccharomyces cerevisiae LTR-retrotransposon Ty3. The counterpart to helix aH of HIV-1 RT, which mediates important interactions with duplex nucleic acid ~3-6 base pairs behind the DNA polymerase catalytic center, was identified between amino acids 290 and 298 of the Ty3 enzyme. The consequences of substituting Gln290, Phe292, Gly294, Asn297 and Tyr298 of Ty3 RT (the counterparts of HIV-1 RT residues Gln258, Leu260, Gly262, Asn265 and Trp266, respectively) for both DNA polymerase and RNase H activity was examined. DNA-dependent DNA synthesis was evaluated on unmodified substrates and on duplexes containing targeted insertion of locked nucleic acid analogs and abasic lesions in either the template or primer. Using this combined strategy, our data suggests an interaction of Ty3 RT residues Tyr298 with primer nucleotide -3, Gly294 with primer nucleotide -4 and Asn297 with template nucleotide -6. Substitution of Ala for Glu290 was well tolerated, despite the high degree of conservation at this position. Mutations in the thumb subdomain of Ty3 also affected RNase H activity, suggesting a closer spatial relationship between its N- and C-terminal catalytic centers compared to HIV-1 RT.