We have studied the CBK1 gene of Saccharomyces cerevisiae, which encodes a conserved protein kinase similar to the human myotonic dystrophy kinase. We have shown that the subcellular localization of the protein, Cbk1p, varies in a cell cycle-dependent manner. Three phenotypes are associated with the inactivation of the CBK1 gene: large aggregates of cells, round rather than ellipsoidal cells and a change from a bipolar to a random budding pattern. Two-hybrid and extragenic suppressor studies have linked Cbk1p with the transcription factor Ace2p, which is responsible for the transcription of chitinase. Cbk1p is necessary for the activation of Ace2p and we have shown that the aggregation phenotype is due to a lack of chitinase expression. The random budding pattern and the round cell phenotype of the CBK1 deletion strain show that in addition to its role in regulating chitinase expression via Ace2p, Cbk1p is essential for a wild-type morphological development of the cell.