Molecular circadian clock regulation engages a negative feedback loop comprising components of the negative limb, PERs and CRYs. In addition to the rhythmic transcriptional regulation of clock genes, controlled subcellular localization might contribute to the molecular mechanism of the mammalian circadian clock. To address this issue, we generated transgenic (TG) mice lines harboring either rat PER2 (rPER2) with a deleted nuclear localizing domain [NLD(-)] or intact PER2. In comparison with wild-type (WT) control, the period of the circadian locomotor rhythm in TG mice over-expressing NLD(-) PER2 was longer, while that in TG mice over-expressing intact PER2 was shorter. The nuclear entry of endogenous PER2, CRY1 and CRY2 was delayed in the suprachiasmatic nucleus (SCN) of NLD(-) PER2 TG mice under constant darkness, whereas that of mouse PER2 (mPER2) is accelerated in the SCN of intact PER2 TG mice. Under constant light, the locomotor activity of NLD(-) PER2 TG mice became arrhythmic, whereas WT animals remained rhythmic. These data indicate that PER2 controls circadian periods through nuclear localization in the SCN. In addition, sleep architecture was also affected in intact PER2 TG mice, suggesting PER2 can modulate a sleep molecular mechanism.