Biochemical studies revealed that nonstructural proteins of hepatitis C virus (HCV) interacted with each other and were associated with intracellular membranes. The goals of this study were to determine whether nonstructural viral proteins are colocalized at specific intracellular sites where HCV RNA is replicated and to identify the virus components of the HCV replication complex (RC). Immunofluorescence and subcellular fractionation studies were performed to determine the intracellular colocalization of nonstructural HCV proteins and the replicating RNA in a human hepatoma cell line, Huh7, in which a subgenomic HCV RNA was replicated persistently. The replicating HCV RNA was labelled with 5-bromouridine 5'-triphosphate (BrUTP). Results show that each of the nonstructural HCV proteins was colocalized predominantly with the newly synthesized HCV RNA labelled with BrUTP and an endoplasmic reticulum (ER) protein, calnexin. Consistent with these findings, subcellular fractionation and Western blot analyses revealed that the nonstructural HCV proteins were colocalized with HCV RNA mainly in the membrane fractions. Conversely, the viral nonstructural proteins and RNA remained in the soluble fractions upon treatment with detergent, confirming the membrane association of the HCV RC. HCV RNA in the membrane-bound RC was resistant to RNase treatment, whereas it became sensitive to RNases once the membranes were disrupted by treatment with detergent, suggesting that the HCV RC is assembled within membrane structures. Collectively, these findings demonstrate that HCV RNA replication occurs in the perinuclear ER membrane-bound HCV RC, containing nonstructural viral proteins and RNA.