P54nrb is a protein implicated in multiple nuclear processes whose specific functions may correlate with its presence at different nuclear locations. Here we characterize paraspeckles, a subnuclear domain containing p54nrb and other RNA-binding proteins including PSP1, a protein with sequence similarity to p54nrb that acts as a marker for paraspeckles. We show that PSP1 interacts in vivo with a subset of the total cellular pool of p54nrb. We map the domain within PSP1 that is mediating this interaction and show it is required for the correct localization of PSP1 to paraspeckles. This interaction is necessary but not sufficient for paraspeckle targeting by PSP1, which also requires an RRM capable of RNA binding. Blocking the reinitiation of RNA Pol II transcription at the end of mitosis with DRB prevents paraspeckle formation, which recommences after removal of DRB, indicating that paraspeckle formation is dependent on RNA Polymerase II transcription. Thus paraspeckles are the sites where a subset of the total cellular pool of p54nrb is targeted in a RNA Polymerase II-dependent manner.