The Flavivirus NS5 protein possesses both (guanine-N7)-methyltransferase and nucleoside-2'-O methyltransferase activities required for sequential methylation of the cap structure present at the 5' end of the Flavivirus RNA genome. Seventeen mutations were introduced into the dengue virus type 2 NS5 methyltransferase domain, targeting amino acids either predicted to be directly involved in S-adenosyl-l-methionine binding or important for NS5 conformation and/or charged interactions. The effects of the mutations on (i) (guanine-N7)-methyltransferase and nucleoside-2'-O methyltransferase activities using biochemical assays based on a bacterially expressed NS5 methyltransferase domain and (ii) viral replication using a dengue virus type 2 infectious cDNA clone were examined. Clustered mutations targeting the S-adenosyl-l-methionine binding pocket or an active site residue abolished both methyltransferase activities and viral replication, demonstrating that both methyltransferase activities utilize a single S-adenosyl-l-methionine binding pocket. Substitutions to single amino acids binding S-adenosyl-l-methionine decreased both methyltransferase activities by varying amounts. However, viruses that replicated at wild type levels could be recovered with mutations that reduced both activities by >75%, suggesting that only a threshold level of methyltransferase activity was required for virus replication in vivo. Mutation of residues outside of regions directly involved in S-adenosyl-l-methionine binding or catalysis also affected methyltransferase activity and virus replication. The recovery of viruses containing compensatory second site mutations in the NS5 and NS3 proteins identified regions of the methyltransferase domain important for overall stability of the protein or likely to play a role in virus replication distinct from that of cap methylation.