In this paper we report the cloning, sequencing and functional characterization of CEN12 and an associated autonomously replicating sequence (ARS) from the budding yeast Saccharomyces cerevisiae. In the course of studying a dynamin-related gene, DNM1, we previously physically mapped the gene to chromosome 12. Genetic mapping showed that the gene was tightly linked (0.35 cM) to the centromere. Subcloning experiments revealed that a centromere-like activity was included in a small segment of DNA immediately downstream from the DNM1 gene. Mitotic centromere activity was discerned by the ability of the region to de-stabilize a centromere-containing plasmid, and to stabilize an ARS-containing plasmid. Meiotic centromere activity was determined by the first-division segregation in crosses of ARS plasmids containing this region. The DNA sequence of this region revealed a sequence with strong homology to the consensus for yeast centromeres.