Β© 2017American Society for Microbiology. The Middle East respiratory syndrome coronavirus (MERS-CoV) nonstructural protein 16 (nsp16) is an S-adenosyl-L-methionine (SAM)-dependent 2'-Omethyltransferase (2'-O-MTase) that is thought to methylate the ribose 2'-OH of the first transcribed nucleotide (N1) of viral RNA cap structures. This 2'-O-MTase activity is regulated by nsp10. The 2'-O methylation prevents virus detection by cell innate immunity mechanisms and viral translation inhibition by the interferon-stimulated IFIT-1 protein. To unravel the regulation of nsp10/nsp16 2'-O-MTase activity, we used purified MERS-CoV nsp16 and nsp10. First, we showed that nsp16 recruited N7-methylated capped RNA and SAM. The SAM binding promotes the assembly of the enzymatically active nsp10/nsp16 complex that converted 7mGpppG (cap-0) into 7mGpppG2'Om (cap-1) RNA by 2'-OH methylation of N1 in a SAM-dependent manner. The subsequent release of SAH speeds up nsp10/nsp16 dissociation that stimulates the reaction turnover. Alanine mutagenesis and RNA binding assays allowed the identification of the nsp16 residues involved in RNA recognition forming the RNA binding groove (K46, K170, E203, D133, R38, Y47, and Y181) and the cap-0 binding site (Y30, Y132, and H174). Finally, we found that nsp10/nsp16 2'-O-MTase activity is sensitive to known MTase inhibitors, such as sinefungin and cap analogues. This characterization of the MERS-CoV 2'-O-MTase is a preliminary step toward the development of molecules to inhibit cap 2'-O methylation and to restore the host antiviral response.