Homothallic Saccharomyces yeasts efficiently interconvert between two cell types, the mating types a and alpha. These interconversions have been proposed to occur by genetic rearrangement ("cassette" insertion) at the locus controlling cell type (the mating type locus). The pattern of switching from one cell type to the other during growth of a clone of homothallic cells has been followed by direct microscopic observation, and the results have been summarized as "rules" of switching. First, when a cell divides, it produces either two cells with the same mating type as the original cell or two cells that have switched to the other mating type. This observation suggests that the mating type locus is changed early in the cell cycle, in late Gl or during S. Second, the ability to produce cells that have switched mating type is restricted to cells that have previously divided ("experienced cells"). Spores and buds ("inexperienced cells") rarely if ever give rise to cells with changed mating type. A homothallic yeast cell thus exhibits asymmetric segregation of the potential for mating type interconversion--at each cell division, the mother, but not the daughter, is capable of switching cell types in its next division. Homothallic cells also exhibit directionality in switching: experienced cells switch to the opposite cell type in more than 50% of cell divisions. These results show that the process of mating type interconversion is itself controlled during growth of a clone of homothallic cells. By analogy and extension of these results, we propose that multiple cell types can be produced in a specific pattern during development of a higher eucaryote in a model involving sequential cassette insertion.