In eukaryotes, the activation of mitotic cyclin-dependent kinases (CDKs) induces mitosis, and their inactivation causes cells to leave mitosis. In budding yeast, two redundant mechanisms induce the inactivation of mitotic CDKs. In one mechanism, a specialized ubiquitin-dependent proteolytic system (called the APC-dependent proteolysis machinery) degrades the mitotic (Clb) cyclin subunit. In the other, the kinase-inhibitor Sic1 binds to mitotic CDKs and inhibits their kinase activity. The highly conserved protein phosphatase Cdc14 promotes both Clb degradation and Sic1 accumulation. Cdc14 promotes SIC1 transcription and the stabilization of Sic1 protein by dephosphorylating Sicl and its transcription factor Swi5. Cdc14 activates the degradation of Clb cyclins by dephosphorylating the APC-specificity factor Cdh1. So how is Cdc14 regulated? Here we show that Cdc14 is sequestered in the nucleolus for most of the cell cycle. During nuclear division, Cdc14 is released from the nucleolus, allowing it to reach its targets. A highly conserved signalling cascade, critical for the exit from mitosis, is required for this movement of Cdc14 during anaphase. Furthermore, we have identified a negative regulator of Cdc14, Cfi1, that anchors Cdc14 in the nucleolus.