Peptide transport in Saccharomyces cerevisiae is controlled by three genes: PTR1, PTR2, and PTR3, PTR1 was cloned and sequenced and found to be identical to UBR1, a gene previously described as encoding the recognition component of the N-end-rule pathway of the ubiquitin-dependent proteolytic system. Independently derived ubr1 mutants, like ptr1 mutants, were unable to transport small peptides into cells. Concomitantly, ptr1 mutants, like ubr1 mutants, were unable to degrade an engineered substrate of the N-end-rule pathway. Further, ptr1 mutants did not express PTR2, a gene encoding the integral membrane component required for peptide transport in S. cerevisiae. These results establish a physiological role for a protein previously known to be required for the degradation of N-end-rule substrates. Our findings show that peptide transport and the ubiquitin pathway--two dynamic phenomena universal to eukaryotic cells--share a common component, namely UBR1/PTR1.