The Drosophila protein Sex-lethal (SXL) promotes skipping of exon 3 from its own pre-mRNA. An unusual sequence arrangement of two AG dinucleotides and an intervening polypyrimidine (Py)-tract at the 3′ end of intron 2 is important for Sxl autoregulation. Here we show that U2AF interacts with the Py-tract and downstream AG, whereas the spliceosomal protein SPF45 interacts with the upstream AG and activates it for the second catalytic step of the splicing reaction. SPF45 represents a new class of second step factors, and its interaction with SXL blocks splicing at the second step. These results are in contrast with other known mechanisms of splicing regulation, which target early events of spliceosome assembly. A similar role for SPF45 is demonstrated in the activation of a cryptic 3′ ss generated by a mutation that causes human β-thalassemia.