Phosphatidylserine decarboxylase plays a pivotal role in the synthesis of phospholipid by the mitochondria. The substrate phosphatidylserine is synthesized extramitochondrially and must be translocated to the mitochondria prior to decarboxylation. To understand the properties of the decarboxylase and exploit its unique topology to address basic questions of interorganelle cooperation in membrane assembly, we have begun to examine this enzyme in Saccharomyces cerevisiae. Strains of the yeast defective in enzyme activity were isolated by modified brute force using 1-acyl-2[N-(6-[7-nitrobenz-2- oxa-1,3-diazo-4-yl)]aminocaproyl] (NBD)-phosphatidyl[1'-14C]serine as substrate for permeabilized cells. Mutant strains with less than 5% wild type activity exhibited no defective growth phenotype. The gene for the phosphatidylserine decarboxylase (PSD) was cloned using an oligonucleotide probe degenerate for the sequence VGAT(I)/(N)VGSI, which is the longest stretch of sequence identity between the Escherichia coli sequence (I at position 5) and the putative CHO cell sequence (N at position 5). The gene encodes a 500 amino acid protein with 28-43% identity to the bacterial and mammalian sequences. The yeast PSD gene maps to the long arm of chromosome 14 between the kex 2 and RAS 2 loci. Null mutations created by disrupting the PSD gene with TRP1 demonstrate that the gene is not essential for cell growth even when the engineered strains are deprived of choline and ethanolamine. Analysis of lipid synthesis and enzyme activity in null mutants indicates that there are two PSD genes.