Transfer RNA (guanosine-2'-)-methyltransferase (Gm-methylase, EC 2.1. 1.32) from Thermus thermophilus HB27 is one of the tRNA ribose modification enzymes. The broad substrate specificity of Gm-methylase has so far been elucidated using various species of tRNAs from native sources, suggesting that the common structures in tRNAs are recognized by the enzyme. In this study, by using 28 yeast tRNAPhe variants obtained by transcription with T7 RNA polymerase, it was revealed that the nucleotide residues G18 and G19 and the D-stem structure are essentially required for Gm-methylase recognition, and that the key sequence for the substrate is pyrimidine (Py)17G18G19. The other conserved sequences were found not to be essential, but U8, G15, G26, G46, U54, U55, and C56 considerably affected the methylation efficiency. These residues are located within a limited space embedded in the L-shaped three-dimensional structure of tRNA. Therefore, disruption of the three-dimensional structure of the substrate tRNA is necessary for the catalytic center of Gm-methylase to be able to access the target site in the tRNA, suggesting that the interaction of Gm-methylase with tRNA consists of multiple steps. This postulation was confirmed by inhibition experiments using nonsubstrate tRNA variants which functioned as competitive inhibitors against usual substrate tRNAs.