A universal feature of retroelement propagation is the formation of distinct nucleoprotein complexes mediated by the Gag capsid protein. The Ty1 retrotransposon Gag protein from Saccharomyces cerevisiae lacks sequence homology with retroviral Gag, but is functionally related. In addition to capsid assembly functions, Ty1 Gag promotes Ty1 RNA dimerization and cyclization and initiation of reverse transcription. Direct interactions between Gag and retrotransposon genomic RNA (gRNA) are needed for Ty1 replication, and mutations in the RNA-binding domain disrupt nucleation of retrosomes and assembly of functional virus-like particles (VLPs). Unlike retroviral Gag, the specificity of Ty1 Gag-RNA interactions remain poorly understood. Here we use microscale thermophoresis (MST) and electrophoretic mobility shift assays (EMSA) to analyze interactions of immature and mature Ty1 Gag with RNAs. The salt-dependent experiments showed that Ty1 Gag binds with high and similar affinity to different RNAs. However, we observed a preferential interaction between Ty1 Gag and Ty1 RNA containing a packaging signal (Psi) in RNA competition analyses. We also uncover a relationship between Ty1 RNA structure and Gag binding involving the pseudoknot present on Ty1 gRNA. In all likelihood, the differences in Gag binding affinity detected in vitro only partially explain selective Ty1 RNA packaging into VLPs in vivo.