To identify activities involved in human pre-mRNA splicing, we have developed a procedure to separate HeLa cell nuclear extract into five complementing fractions. An activity called SCF1 was purified from one of these fractions by assaying for reconstitution of splicing in the presence of the remaining four fractions. A component of SCF1 is shown to be PP2Cgamma, a type 2C Ser/Thr phosphatase of previously unknown function. Previous work suggested that dephosphorylation of splicing factors may be important for catalysis after spliceosome assembly, although the identities of the specific phosphatases involved remain unclear. Here we show that human PP2Cgamma is physically associated with the spliceosome in vitro throughout the splicing reaction, but is first required during the early stages of spliceosome assembly for efficient formation of the A complex. The phosphatase activity is required for the splicing function of PP2Cgamma, as an active site mutant does not support spliceosome assembly. The requirement for PP2Cgamma is highly specific, as the closely related phosphatase PP2Calpha cannot substitute for PP2Cgamma. Consistent with a role in splicing, PP2Cgamma localizes to the nucleus in vivo. We conclude that at least one specific dephosphorylation event catalyzed by PP2Cgamma is required for formation of the spliceosome.