The expression of many genes of Saccharomyces cerevisiae, such as ITR1, is regulated by inositol and choline. In this work, a yeast strain has been constructed in which HIS3 expression is controlled by the ITR1 promoter. Using this strain, three genes were isolated which, when introduced as multicopies, abolish the repression caused by inositol via the ITR1 promoter. Northern blot analysis revealed that two of these three genes, designated as DIE1 and DIE2, clearly increased the expression of ITR1. DIE2 is more effective for ITR1 expression than DIE1. Gene-disruption experiments revealed that DIE1 was essential for the expression of ITR1 but that DIE2 was not. The sequence of the DIE1 gene was shown to be identical to that of INO2 (also called SCS1), which encodes a protein required for the expression of INO1. DIE2 is a new gene and is capable of encoding 525 amino acid residues with a calculated molecular weight of 61,789. Experiments involving lacZ fusion genes showed that multicopy DIE2 resulted in an increase in the expression of both ITR1 and INO1. These results strongly suggest that the DIE1 and DIE2 gene products have an important regulatory function for gene expression of not only ITR1 but also INO1.