HeLa nuclear homogenates incubated in vitro incorporate [beta-32P]ATP and S-[methyl-3H]-adenosylmeth-ionine ([3H]SAM) into blocked methylated 5' termini of newly synthesized RNA. Approximately 10% of the RNA chains initiated in vitro with [beta-32P]ATP are subsequently blocked by condensation of GMP to di- or triphosphate terminated RNA. The blocked termini can then be methylated by transfer of methyl groups from [3H]SAM to the 7 position of the guanosine and 2'-O position of the adenosine to form m7Gpp*pAm- capped terminus. In addition to conventional triphosphate caps, HeLa nuclear homogenates produce capping structures containing two phosphate residues in the pyrophosphate bridge. The two distinct cap forms were separated by DEAE-cellulose chromatography and analyzed. In contrast to triphosphate caps (m7GpppXm) in which X can be any one of the four nucleosides (G, A, C, or U), in diphosphate caps (m7GppXm), more than 95% of the penultimate nucleoside Xm is G. Incorporation of both [beta-32P]ATP and [3H]SAM into caps was markedly reduced by low concentrations of alpha-amanitin. However, an ammonium sulfate fraction of the nuclear homogenate can cap beta-32P-labeled RNA (pp*pA-RNA) to form m7Gpp*pA-RNA, in the presence of 0.5 microgram/mL of alpha-amanitin. Therefore, the nuclear capping enzyme is resistant to this drug. Our results indicate that RNA polymerase II primary transcripts are the substrate for the cellular capping enzyme and that the beta phosphate in the pyrophosphate bridge (m7GgammapbetapalphapXm) is derived from the 5' ends of the RNA chains.