U4 small nuclear RNA is essential for trans-splicing. Here we report the cloning of U4 snRNA gene from Leptomonas collosoma and analysis of elements controlling its expression. The trypanosome U4 RNA is the smallest known, it carries an Sm-like site, and has the potential for extensive intermolecular base pairing with the U6 RNA. Sequence analysis of the U4 locus indicates the presence of a tRNA-like element 86 base pairs upstream of the gene that is divergently transcribed to yield a stable small tRNA-like RNA. Two additional tRNA genes, tRNA(Pro) and tRNA(Gly), were found upstream of this element. By stable expression of a tagged U4 RNA, we demonstrate that the tRNA-like gene, but not the upstream tRNA genes, is essential for U4 expression and that the B box but not the A Box of the tRNA-like gene is crucial for expression in vivo. Mapping the 2'-O-methyl groups on U4 and U6 small nuclear RNAs suggests the presence of modifications in canonical positions. However, the number of modified nucleotides is fewer than in mammalian homologues. The U4 genomic organization including both tRNA-like and tRNA genes may represent a relic whereby trypanosomatids "hired" tRNA genes to provide extragenic promoter elements. The close proximity of tRNA genes to the tRNA-like molecule in the U4 locus further suggests that the tRNA-like gene may have evolved from a tRNA member of this cluster.