We have identified Cdc55, a regulatory B subunit of protein phosphatase 2A (PP2A), as an essential activating factor for stress gene transcription in Saccharomyces cerevisiae. The presence of PP2A-Cdc55 is required for full activation of the environmental stress response mediated by the transcription factors Msn2 and Msn4. We show that PP2A-Cdc55 contributes to sustained nuclear accumulation of Msn2 and Msn4 during hyperosmolarity stress. PP2A-Cdc55 also enhances Msn2-dependent transactivation, required for extended chromatin recruitment of the transcription factor. We analyzed a possible direct regulatory role for PP2A-Cdc55 on the phosphorylation status of Msn2. Detailed mass spectrometric and genetic analysis of Msn2 showed that stress exposure causes immediate transient dephosphorylation of Msn2 which is not dependent on PP2A-Cdc55 activity. Furthermore, the Hog1 mitogen-activated protein kinase pathway activity is not influenced by PP2A-Cdc55. We therefore propose that the PP2A-Cdc55 phosphatase is not involved in cytosolic stress signal perception but is involved in a specific intranuclear mechanism to regulate Msn2 and Msn4 nuclear accumulation and chromatin association under stress conditions.