The translocation liposarcoma protein TLS has recently been shown to function as an adapter molecule coupling gene transcription to RNA splicing. Here we demonstrate that YB-1, a protein known to play important roles in transcription and translation, interacts with the COOH-terminal domains of TLS and the structurally related Ewing’s sarcoma protein EWS. Through this interaction, YB-1 is recruited to RNA polymerase II and promotes splicing of E1A pre-mRNA to the 13S isoform. This splicing function of YB-1 is inhibited by exogenous TLS/ERG or EWS/Fli-1 fusion proteins, which bind to RNA polymerase II but fail to recruit the YB-1 protein. In Ewing’s sarcoma cells that express endogenous EWS/Fli-1, this linkage between YB-1 and RNA Pol II via EWS (or TLS) was found to be defective. Together, these results suggest that TLS and EWS fusion proteins may contribute to malignant transformation through disruption of RNA splicing mediated by TLS- and EWS-binding proteins such as YB-1.