Insufficient expression of the survival motor neuron (SMN) protein causes spinal muscular atrophy, a neurodegenerative disease characterized by loss of motor neurons. Despite the importance of maintaining adequate SMN levels, little is known about factors that control SMN expression, particularly 3' end processing of the SMN pre-mRNA. In this study, we identify the U1A protein as a key regulator of SMN expression. U1A, a component of the U1 snRNP, is known to inhibit polyadenylation upon direct binding to mRNA. We show that U1A binds directly and with high affinity and specificity to the SMN 3'-UTR adjacent to the polyadenylation site, independent of the U1 snRNP (U1 small nuclear ribonucleoprotein). Binding of U1A inhibits polyadenylation of the SMN pre-mRNA by specifically inhibiting 3' cleavage by the cleavage and polyadenylation specificity factor. Expression of U1A in excess of U1 snRNA causes inhibition of SMN polyadenylation and decreases SMN protein levels. This work reveals a new mechanism for regulating SMN levels and provides new insight into the roles of U1A in 3' processing of mRNAs.