ARGONAUTE4 (AGO4) and RNA polymerase IV (Pol IV) are required for DNA methylation guided by 24 nucleotide small interfering RNAs (siRNAs) in Arabidopsis thaliana. Here we show that AGO4 localizes to nucleolus-associated bodies along with the Pol IV subunit NRPD1b; the small nuclear RNA (snRNA) binding protein SmD3; and two markers of Cajal bodies, trimethylguanosine-capped snRNAs and the U2 snRNA binding protein U2B''. AGO4 interacts with the C-terminal domain of NRPD1b, and AGO4 protein stability depends on upstream factors that synthesize siRNAs. AGO4 is also found, along with the DNA methyltransferase DRM2, throughout the nucleus at presumed DNA methylation target sites. Cajal bodies are conserved sites for the maturation of ribonucleoprotein complexes. Our results suggest a function for Cajal bodies as a center for the assembly of an AGO4/NRPD1b/siRNA complex, facilitating its function in RNA-directed gene silencing at target loci.