The RNA:pseudouridine (Psi)-synthase family is one of the most complex families of RNA modification enzymes. Ten genes encoding putative RNA:Psi-synthases have been identified in S. cerevisiae. Most of the encoded enzymes have been characterized experimentally. Only the putative RNA:Psi-synthase Pus2p (encoded by the YGL063w ORF) had no identified substrate. Here, we analyzed Psi residues in cytoplasmic and mitochondrial tRNAs extracted from S. cerevisiae strains, carrying disruptions in the PUS1 and/or PUS2 ORFs. Our results demonstrate that Pus2p is a mitochondrial-specific tRNA:Psi-synthase acting at positions 27 and 28 in tRNAs. The importance of the Asp56 residue in the conserved ARTD motif of the Pus2p catalytic site is demonstrated in vivo. Interestingly, in spite of the absence of a characteristic N-terminal targeting signal, our data strongly suggest an efficient and rapid targeting of Pus2p in yeast mitochondria. In contradiction with the commonly held idea that a unique nuclear gene encodes the enzyme required for both cytoplasmic and mitochondrial tRNA modifications, here we show the existence of an enzyme specifically dedicated to mitochondrial tRNA modification (Pus2p), the corresponding modification in cytoplasmic tRNAs being catalyzed by another protein (Pus1p).