Human ADAR3 is a catalytically inactive member of the Adenosine Deaminase Acting on RNA (ADAR) protein family, whose active members catalyze A-to-I RNA editing in metazoans. Until now, the reasons for the catalytic incapability of ADAR3 has not been defined and its biological function rarely explored. Yet, its exclusive expression in the brain and involvement in learning and memory suggest a central role in the nervous system. Here we describe the engineering of a catalytically active ADAR3 enzyme using a combination of computational design and functional screening. Five mutations (A389V, V485I, E527Q, Q549R and Q733D) engender RNA deaminase in human ADAR3. By way of its catalytic activity, the ADAR3 pentamutant was used to identify potential binding targets for wild type ADAR3 in a human glioblastoma cell line. Novel ADAR3 binding sites discovered in this manner include the 3'-UTRs of the mRNAs encoding early growth response 1 (EGR1) and dual specificity phosphatase 1 (DUSP1); both known to be activity-dependent immediate early genes that respond to stimuli in the brain. Further studies reveal that the wild type ADAR3 protein can regulate transcript levels for DUSP1 and EGR1, suggesting a novel role ADAR3 may play in brain function.