The product of the Saccharomyces cerevisiae AER2 gene is responsible for maintaining repression of at least two distinct regulatory pathways: heme activation/repression and catabolite repression. Mutations in the gene caused an eightfold increase in the expression of the heme-activated CYC1 gene in the absence of heme, a substantial increase in the expression of the heme-repressed ANB1 gene in the presence of heme, and a 13-fold increase in the expression of the catabolite-repressed GAL1 gene in the presence of glucose. Lesser or no increases in the expression of these genes were observed under derepressed or activation conditions. The aer2 mutations also caused a large increase in CYC7 gene expression under all conditions; this gene is subject to heme activation/repression, as well as catabolite repression. The AER2 gene was cloned and the sequence determined. The large open reading frame contiguous with the transcript from the complementing region encoded a 713-amino acid polypeptide chain with extensive homology to the beta-subunit of G proteins. The sequence revealed that AER2 is the TUP1 gene. A deletion mutation was constructed and the null phenotype was the same as the original mutants. The aer2 null mutant was shown to have increased aerobic and anaerobic levels of RNA encoding the ROX1 repressor, normally expressed only aerobically and responsible for the aerobic repression of ANB1 expression. The increase in both ROX1 and ANB1 RNAs aerobically in this mutant suggests that the repressor is nonfunctional in the mutant.