The cellular protein p32 was isolated originally as a protein tightly associated with the essential splicing factor ASF/SF2 during its purification from HeLa cells. ASF/SF2 is a member of the SR family of splicing factors, which stimulate constitutive splicing and regulate alternative RNA splicing in a positive or negative fashion, depending on where on the pre-mRNA they bind. Here we present evidence that p32 interacts with ASF/SF2 and SRp30c, another member of the SR protein family. We further show that p32 inhibits ASF/SF2 function as both a splicing enhancer and splicing repressor protein by preventing stable ASF/SF2 interaction with RNA, but p32 does not block SRp30c function. ASF/SF2 is highly phosphorylated in vivo, a modification required for stable RNA binding and protein-protein interaction during spliceosome formation, and this phosphorylation, either through HeLa nuclear extracts or through specific SR protein kinases, is inhibited by p32. Our results suggest that p32 functions as an ASF/SF2 inhibitory factor, regulating ASF/SF2 RNA binding and phosphorylation. These findings place p32 into a new group of proteins that control RNA splicing by sequestering an essential RNA splicing factor into an inhibitory complex.