RNA localization is a widespread mechanism for achieving localized protein synthesis. In Saccharomyces cerevisiae, Ash1 is a specific repressor of transcription that localizes asymmetrically to the daughter cell nucleus through the localization of ASH1 mRNA to the distal tip of the daughter cell. This localization depends on the actin cytoskeleton and five She proteins, one of which is a type V myosin motor, Myo4. We show here that a novel RNA-binding protein, Khd1 (KH-domain protein 1), is required for efficient localization of ASH1 mRNA to the distal tip of the daughter cell. Visualization of ASH1 mRNA in vivo using GFP-tagged RNA demonstrated that Khd1 associates with the N element, a cis-acting localization sequence within the ASH1 mRNA. Co-immunoprecipitation studies also indicated that Khd1 associates with ASH1 mRNA through the N element. A khd1Delta mutation exacerbates the phenotype of a weak myo4 mutation, whereas overexpression of KHD1 decreases the concentration of Ash1 protein and restores HO expression to she mutants. These results suggest that Khd1 may function in the linkage between ASH1 mRNA localization and its translation.