N1-Methylguanosine (m1G) or wye nucleoside (Y) are found 3' adjacent to the anticodon (position 37) of eukaryotic tRNAPhe. The biosynthesis of these two modified nucleosides has been investigated. The importance of the type of nucleosides in the anticodon of yeast tRNAPhe on the potentiality of this tRNA to be a substrate for the corresponding maturation enzyme has also been studied. This involved microinjection into Xenopus laevis oocytes and incubation in a yeast extract of restructured yeast tRNAPhe in which the anticodon GmAA and the 3' adjacent Y nucleoside were substituted by various tetranucleotides ending with a guanosine. The results obtained by oocyte microinjection indicate: that all the restructured yeast tRNAsPhe are efficient substrates for the tRNA (guanosine-37 N1)methyltransferase. This means that the anticodon sequence is not critical for the tRNA recognition by this enzyme; in contrast, for Y nucleoside biosynthesis, the anticodon sequence GAA is an absolute requirement; the conversion of G-37 into Y-37 nucleoside is a multienzymatic process in which m1G-37 is the first obligatory intermediate; all the corresponding enzymes are cytoplasmic. In a crude yeast extract, restructured yeast tRNAPhe with G-37 is efficiently modified only into m1G-37; the corresponding enzyme is a S-adenosyl-L-methionine-dependent tRNA methyltransferase. The pure Escherichia coli tRNA (guanosine-37 N1) methyltransferase is unable to modify the guanosine-37 of yeast tRNAPhe.