How pseudouridylation (Ψ), the most common and evolutionarily conserved modification of rRNA, regulates ribosome activity is poorly understood. Medically, Ψ is important because the rRNA Ψ synthase, DKC1, is mutated in X-linked dyskeratosis congenita (X-DC) and Hoyeraal-Hreidarsson (HH) syndrome. Here, we characterize ribosomes isolated from a yeast strain in which Cbf5p, the yeast homolog of DKC1, is catalytically impaired through a D95A mutation (cbf5-D95A). Ribosomes from cbf5-D95A cells display decreased affinities for tRNA binding to the A and P sites as well as the cricket paralysis virus internal ribosome entry site (IRES), which interacts with both the P and the E sites of the ribosome. This biochemical impairment in ribosome activity manifests as decreased translational fidelity and IRES-dependent translational initiation, which are also evident in mouse and human cells deficient for DKC1 activity. These findings uncover specific roles for Ψ modification in ribosome-ligand interactions that are conserved in yeast, mouse, and humans. © 2011 Elsevier Inc.