Yeast TFIID comprises the TATA binding protein and 14 TBP-associated factors (TAF(II)s), nine of which contain histone-fold domains (HFDs). The C-terminal region of the TFIID-specific yTAF4 (yTAF(II)48) containing the HFD shares strong sequence similarity with Drosophila (d)TAF4 (dTAF(II)110) and human TAF4 (hTAF(II)135). A structure/function analysis of yTAF4 demonstrates that the HFD, a short conserved C-terminal domain (CCTD), and the region separating them are all required for yTAF4 function. Temperature-sensitive mutations in the yTAF4 HFD alpha2 helix or the CCTD can be suppressed upon overexpression of yTAF12 (yTAF(II)68). Moreover, coexpression in Escherichia coli indicates direct yTAF4-yTAF12 heterodimerization optimally requires both the yTAF4 HFD and CCTD. The x-ray crystal structure of the orthologous hTAF4-hTAF12 histone-like heterodimer indicates that the alpha3 region within the predicted TAF4 HFD is unstructured and does not correspond to the bona fide alpha3 helix. Our functional and biochemical analysis of yTAF4, rather provides strong evidence that the HFD alpha3 helix of the TAF4 family lies within the CCTD. These results reveal an unexpected and novel HFD organization in which the alpha3 helix is separated from the alpha2 helix by an extended loop containing a conserved functional domain.