Targeting of viral proteins to specific subcellular compartments is a fundamental step for viruses to achieve successful replication in infected cells. Borna disease virus 1 (BoDV-1)， a nonsegmented， negative-strand RNA virus， uniquely replicates and persists in the cell nucleus. Here， it is demonstrated that BoDV nucleoprotein (N) transcripts undergo mRNA splicing to generate truncated isoforms. In combination with alternative usage of translation initiation sites， the N gene potentially expresses at least six different isoforms， which exhibit diverse intracellular localizations， including the nucleoplasm， cytoplasm， and endoplasmic reticulum (ER)， as well as intranuclear viral replication sites. Interestingly， the ER-targeting signal peptide in N is exposed by removing the intron by mRNA splicing. Furthermore， the spliced isoforms inhibit viral polymerase activity. Consistently， recombinant BoDVs lacking the N-splicing signals acquire the ability to replicate faster than wild-type virus in cultured cells， suggesting that N isoforms created by mRNA splicing negatively regulate BoDV replication. These results provided not only the mechanism of how mRNA splicing generates viral proteins that have distinct functions but also a novel strategy for replication control of RNA viruses using isoforms with different subcellular localizations. Borna disease virus (BoDV) is a highly neurotropic RNA virus that belongs to the orthobornavirus genus. A zoonotic orthobornavirus that is genetically related to BoDV has recently been identified in squirrels， thus increasing the importance of understanding the replication and pathogenesis of orthobornaviruses. BoDV replicates in the nucleus and uses alternative mRNA splicing to express viral proteins. However， it is unknown whether the virus uses splicing to create protein isoforms with different functions. The present study demonstrated that the nucleoprotein transcript undergoes splicing and produces four new isoforms in coordination with alternative usage of translation initiation codons. The spliced isoforms showed a distinct intracellular localization， including in the endoplasmic reticulum， and recombinant viruses lacking the splicing signals replicated more efficiently than the wild type. The results provided not only a new regulation of BoDV replication but also insights into how RNA viruses produce protein isoforms from small genomes.