The Candida albicans PDR16 gene, encoding a putative phosphatidylinositol transfer protein, is co-induced with the multidrug transporter genes CDR1 and CDR2 in azole-resistant (A(R)) clinical isolates and upon fluphenazine exposure of azole-susceptible (A(S)) cells, suggesting that it is regulated by Tac1p, the transcriptional activator of CDR genes. Deleting TAC1 in an A(R) isolate (5674) overexpressing PDR16, CDR1 and CDR2 decreased the expression of the three genes and fluconazole resistance to levels similar to those detected in the matched A(S) isolate (5457), demonstrating that Tac1p is responsible for PDR16 upregulation in that strain. Deleting TAC1 in the A(S) strain SC5314 abolished CDR2 induction by fluphenazine and decreased that of PDR16 and CDR1, uncovering the participation of an additional factor in the regulation of PDR16 and CDR1 expression. Sequencing of the TAC1 alleles identified one homozygous mutation in strain 5674, an Asn to Asp substitution at position 972 in the C-terminus of Tac1p. Introduction of the Asp(972) allele in a tac1Delta/Delta mutant caused high levels of fluconazole resistance and TAC1, PDR16, CDR1 and CDR2 constitutive induction. These results demonstrate that: (i) Tac1p controls PDR16 expression; (ii) Asn(972) to Asp(972) is a gain-of-function mutation; and (iii) Tac1p is positively autoregulated, directly or indirectly.