Spinal muscular atrophy (SMA) is a neurodegenerative disease of motor neurons caused by reduced levels of functional survival of motor neurons (SMN) protein. Cytoplasmic SMN directly interacts with spliceosomal Sm proteins and facilitates their assembly onto U snRNAs. Nuclear SMN, in contrast, mediates recycling of pre-mRNA splicing factors. In this study, we have addressed the function of SMN in the nucleus. We show that a monoclonal antibody directed against SMN inhibits pre-mRNA splicing. Interestingly, the mode of inhibition suggests a novel role for SMN in splicing that occurs prior to, or in addition to, its role in recycling. Using biochemical fractionation and anti-SMN immunoaffinity chromatography, we identified two distinct nuclear SMN complexes termed NSC1 and NSC2. The biochemical properties and protein composition of NSC1 were determined in detail. NSC1 migrates in sucrose gradients as a U snRNA-free 20S complex containing at least 10 proteins. In addition to SMN, these include the SMN-interacting protein 1 (SIP-1), the putative helicase dp103/Gemin3, the novel dp103/Gemin3-interacting protein GIP1/Gemin4 and three additional proteins with apparent masses of 43, 33 and 18 kDa, respectively. Most surprisingly, NSC1 also contains a specific subset of spliceosomal Sm proteins. This shows that the SMN–Sm protein interaction is not restricted to the cytoplasm. Our data imply that nuclear SMN affects splicing by modulating the Sm protein composition of U snRNPs.