The signaling pathways involving class I phosphatidylinositol 3-kinases (PI3K) and the phosphatidylinositol-(3,4,5)-trisphosphate phosphatase PTEN regulate cell proliferation and survival. Thus, mutations in the corresponding genes are associated to a wide variety of human tumors. Heterologous expression of hyperactive forms of mammalian p110alpha and p110beta in Saccharomyces cerevisiae leads to growth arrest, which is counterbalanced by coexpression of mammalian PTEN. Using this in vivo yeast-based system, we have done an extensive functional analysis of germ-line and somatic human PTEN mutations, as well as a directed mutational analysis of discrete PTEN functional domains. A distinctive penetrance of the PTEN rescue phenotype was observed depending on the levels of PTEN expression in yeast and on the combinations of the inactivating PTEN mutations and the activating p110alpha or p110beta mutations analyzed, which may reflect pathologic differences found in tumors with distinct alterations at the p110 and PTEN genes or proteins. We also define the minimum length of the PTEN protein required for stability and function in vivo. In addition, a random mutagenesis screen on PTEN based on this system allowed both the reisolation of known clinically relevant PTEN mutants and the identification of novel PTEN loss-of-function mutations, which were validated in mammalian cells. Our results show that the PI3K/PTEN yeast-based system is a sensitive tool to test in vivo the pathologic properties and the functionality of mutations in the human p110 proto-oncogenes and the PTEN tumor suppressor and provide a framework for comprehensive functional studies of these tumor-related enzymes.