Ubiquinone (coenzyme Q) is a lipid that transports electrons in the respiratory chains of both prokaryotes and eukaryotes. Mutants of Saccharomyces cerevisiae deficient in ubiquinone biosynthesis fail to grow on nonfermentable carbon sources and have been classified into eight complementation groups (coq1 coq8; Tzagoloff, A., and Dieckmann, C. L.(1990) Microbiol. Rev. 54, 211-225). In this study we show that although yeast coq7 mutants lack detectable ubiquinone, the coq7 1 mutant does synthesize demethoxyubiquinone (2-hexaprenyl-3-methyl-6-methoxy-1,4-benzoquinone), a ubiquinone biosynthetic intermediate. The corresponding wild-type COQ7 gene was isolated, sequenced, and found to restore growth on nonfermentable carbon sources and the synthesis of ubiquinone. The sequence predicts a polypeptide of 272 amino acids which is 40% identical to a previously reported Caenorhabditis elegans open reading frame. Deletion of the chromosomal COQ7 gene generates respiration defective yeast mutants deficient in ubiquinone. Analysis of several coq7 deletion strains indicates that, unlike the coq7 1 mutant, demethoxyubiquinone is not produced. Both coq7 1 and coq7 deletion mutants, like other coq mutants, accumulate an early intermediate in the ubiquinone biosynthetic pathway, 3-hexaprenyl-4-hydroxybenzoate. The data suggest that the yeast COQ7 gene may encode a protein involved in one or more monoxygenase or hydroxylase steps of ubiquinone biosynthesis.