G protein-coupled receptors that transduce signals for many hormones, neurotransmitters, and inflammatory mediators are internalized and subsequently recycled to the plasma membrane, or down-regulated by targeting to lysosomes for degradation. Here we have characterized yeast alpha-factor receptors tagged with green fluorescent protein (Ste2-GFP) and used them to obtain mutants defective in receptor down-regulation. In wild type cells, Ste2-GFP was functional and localized to the plasma membrane and endocytic compartments. Although GFP was fused to the cytoplasmic tail of the receptor, GFP also accumulated in the lumen of the vacuole, suggesting that the receptor's extracellular and cytoplasmic domains are degraded within the vacuole lumen. Transposon mutagenesis and a visual screen were used to identify mutants displaying aberrant localization of Ste2-GFP. Mutants that accumulated Ste2-GFP in numerous intracellular vesicles carried disruptions of the VAM3/PTH1 gene, which encodes a syntaxin homolog (t-SNARE) required for homotypic vacuole membrane fusion, autophagy and fusion of biosynthetic transport vesicles with the vacuole. We provide evidence that Vam3 is required for the delivery of alpha-factor receptor-ligand complexes to the vacuole. Vam3 homologs in mammalian cells may mediate late steps in the down-regulation and lysosomal degradation pathways of various G protein-coupled receptors.