Expression of the genes in the ADE regulon of Saccharomyces cerevisiae is repressed by the presence of purine bases in the extracellular medium and derepressed when cells are grown in the absence of purines. Derepression requires the transcriptional activators Bas1 and Pho2, as well as the biosynthetic intermediates 5'-phosphoribosyl-4-succinocarboxamide-5-aminoimidazole (SAICAR) and 5'-phosphoribosyl-4-carboxamide- 5-aminoimidazole (AICAR). In this study, we investigated if nuclear localization and binding to promoter DNA by the activators are regulated by purines. Using indirect immunofluorescence, we found that Bas1 is localized to the nucleus under both repressing and derepressing conditions. Importantly, we detected Bas1 bound to promoter DNA under both conditions using chromatin immunoprecipitation assays at several ADE promoters (ADE1, ADE2, ADE4, and ADE5,7) and HIS4. We analyzed the binding of Bas1 to wild-type and mutant sequences of the ADE5,7 promoters in vivo, and found that Bas1 binds independently to each of its two binding sites. Pho2 was not required for the association of Bas1 with chromosomal DNA, but it was required for an increase in Bas1-immunoprecipitated DNA. The presence of Pho2 at promoters was dependent on Bas1 and occurred only under derepressing conditions when the ADE genes are transcribed at elevated levels. We propose a model for regulation of the ADE genes in which DNA-bound Bas1 is inactive due to masking of its activation domain and Pho2 binds poorly to promoters when cells have sufficient purine nucleotides. Upon limitation for purines, the SAICAR/AICAR regulatory signal is transmitted to the nucleus to increase Bas1 and Pho2 interaction, recruiting Pho2 to promoters and freeing the activation domains for transactivation.