The glycoprotein (G) of vesicular stomatitis virus (VSV) is responsible for binding of virus to cells and for mediating virus entry following endocytosis by inducing fusion of the viral envelope with the endosomal membrane. The fusion peptide of G is internal (residues 116 to 137) and exhibits characteristics similar to those of other internal fusion peptides, but recent studies have implicated the region adjacent to the transmembrane domain as also being important for G-mediated membrane fusion. Sequence alignment of the membrane-proximal region of G from several different vesiculoviruses revealed that this domain is highly conserved, suggesting that it is important for G function. Mutational analysis was used to show that this region is not essential for G protein oligomerization, transport to the cell surface, or incorporation into virus particles but that it is essential for acid-induced membrane fusion activity and for virus infectivity. Deletion of the 13 membrane-proximal amino acids (N449 to W461) dramatically reduced cell-cell fusion activity and reduced virus infectivity approximately 100-fold, but mutation of conserved aromatic residues (W457, F458, and W461) either singly or together had only modest effects on cell-cell fusion activity; recombinant virus encoding these mutants replicated as efficiently as wild-type (WT) VSV. Insertion of heterologous sequences in the juxtamembrane region completely abolished membrane fusion activity and virus infectivity, as did deletion of residues F440 to N449. The insertion mutants showed some changes in pH-dependent conformational changes and in virus binding, which could partially explain the defects in membrane fusion activity, but all the other mutants were similar to WT G with respect to conformational changes and virus binding. These data support the hypothesis that the membrane-proximal domain contributes to G-mediated membrane fusion activity, yet the conserved aromatic residues are not essential for membrane fusion or virus infectivity.