The Sendai virus polymerase is composed of the P and L proteins and carries out both mRNA synthesis and genome replication from the same nucleocapsid template. For mRNA synthesis, P interacts with the assembled NP of the nucleocapsid, and for genome replication, P interacts as well with unassembled NP for nascent chain assembly. The V and W nonstructural proteins, which are translated from edited P gene mRNAs and contain only the N-terminal half of the P protein, were found to inhibit genome replication but not mRNA synthesis. As genome replication is thought of as RNA synthesis plus concurrent encapsidation of the nascent chain, this half of P presumably plays a specific role in RNA encapsidation. Deletion analysis of the P gene found that residues 1-77 in the N-terminal half were in fact essential for RNA encapsidation. Moreover, either residues 1-77 or 78-144 also provided a function that was essential for RNA synthesis per se. Unlike other regions of P, such as those which bind NP in the C-terminal half, the N-terminal domains are very poorly conserved even among related viruses, show signs of acting in a position-independent manner, and, at least for RNA synthesis, are functionally redundant, similar to acidic activation domains of cellular transcription factors.