Pseudouridylation of messenger RNA emerges as an abundant modification involved in gene expression regulation. Pseudouridylation of stop codons in eukaryotic and bacterial cells results in stop-codon read through. The structural mechanism of this phenomenon is not known. Here we present a 3.1-A crystal structure of Escherichia coli release factor 1 (RF1) bound to the 70S ribosome in response to the PsiAA codon. The structure reveals that recognition of a modified stop codon does not differ from that of a canonical stop codon. Our in vitro biochemical results support this finding by yielding nearly identical rates for peptide release from E. coli ribosomes programmed with pseudouridylated and canonical stop codons. The crystal structure also brings insight into E. coli RF1-specific interactions and suggests involvement of L27 in bacterial translation termination. Our results are consistent with a mechanism in which read through of a pseudouridylated stop codon in bacteria results from increased decoding by near-cognate tRNAs (miscoding) rather than from decreased efficiency of termination