Both of the Saccharomyces cerevisiae 2 microm circle-encoded Rep1 and Rep2 proteins are required for efficient distribution of the plasmid to daughter cells during cellular division. In this study two-hybrid and in vitro protein interaction assays demonstrate that the first 129 amino acids of Rep1 are sufficient for self-association and for interaction with Rep2. Deletion of the first 76 amino acids of Rep1 abolished the Rep1-Rep2 interaction but still allowed some self-association, suggesting that different but overlapping domains specify these interactions. Amino- or carboxy-terminally truncated Rep1 fusion proteins were unable to complement defective segregation of a 2 microm-based stability vector with rep1 deleted, supporting the idea of the requirement of Rep protein interaction for plasmid segregation but indicating a separate required function for the carboxy-terminal portion of Rep1. The results of in vitro baiting assays suggest that Rep2 contains two nonoverlapping domains, both of which are capable of mediating Rep2 self-association. The amino-terminal domain interacts with Rep1, while the carboxy-terminal domain was shown by Southwestern analysis to have DNA-binding activity. The overlapping Rep1 and Rep2 interaction domains in Rep1, and the ability of Rep2 to interact with Rep1, Rep2, and DNA, suggest a model in which the Rep proteins polymerize along the 2 microm circle plasmid stability locus, forming a structure that mediates plasmid segregation. In this model, competition between Rep1 and Rep2 for association with Rep1 determines the formation or disassembly of the segregation complex.