Many RNAs contain tertiary interactions that contribute to folding the RNA into its functional 3D structure. In the VS ribozyme, a tertiary loop–loop kissing interaction involving stem–loops I and V is also required to rearrange the secondary structure of stem–loop I such that nucleotides at the base of stem I, which contains the cleavage–ligation site, can adopt the conformation required for activity. In the current work, we have used mutants that constitutively adopt the catalytically permissive conformation to search for additional roles of the kissing interaction in vitro. Using mutations that disrupt or restore the kissing interaction, we find that the kissing interaction contributes ∼1000-fold enhancement to the rates of cleavage and ligation. Large Mg2+-dependent effects on equilibrium were also observed: in the presence of the kissing interaction cleavage is favored >10-fold at micromolar concentrations of Mg2+; whereas ligation is favored >10-fold at millimolar concentrations of Mg2+. In the absence of the kissing interaction cleavage exceeds ligation at all concentrations of Mg2+. These data provide evidence that the kissing interaction strongly affects the observed cleavage and ligation rate constants and the cleavage–ligation equilibrium of the ribozyme.