We have analyzed the mechanism of branchpoint nucleotide selection during the first step of pre-mRNA splicing. It has previously been proposed that the branchpoint is selected as an adenosine residue bulged out of an RNA helix formed by the U2 snRNA-pre-mRNA base pairing. Although compatible with this bulge hypothesis, available data from both yeast and mammalian systems did not rule out alternative structures for the branch nucleotide. Mutating the residue preceding the branchpoint nucleotide in our reporter construct conferred a splicing defect that was suppressed in vivo by the complementary U2 snRNA mutants. In contrast, substitutions on the 3′ side of the branchpoint could be suppressed by complementary U2 snRNA mutants only in a weakened intron context. To test why the identity of the branch nucleotide was important for its selection, we analyzed the effect of substitutions at this position on spliceosome assembly. We observed that these mutations block the formation of one of the two commitment complexes. Our results demonstrate that yeast branchpoint selection occurs in multiple steps. The nature of the branch residue is recognized, in the absence of U2 snRNA, during commitment complex formation. Then, base pairing with U2 snRNA constrains this residue into a bulge conformation.