The stress-activated Wis1-Spc1 protein kinase cascade links mitotic control with environmental signals in Schizosaccharomyces pombe. Fission yeast spc1- mutants are delayed in G2 during normal growth and undergo G2 arrest when exposed to osmotic or oxidative stress. Here we report that Spc1 also has an important role in regulating sexual development in S. pombe. This discovery arose from the observation that Spc1 is activated in response to nitrogen limitation, a key signal that promotes conjugation in fission yeast. Mutant spc1- cells are defective at arresting in G2 during nitrogen starvation and exhibit a poor mating ability. These deficiencies correlate with a failure to induce transcription of ste11+, a gene that encodes a transcription factor responsible for expression of various meiotic genes. Two genes, atf1+ and atf21+, were cloned as multicopy suppressors of the spc1- mating defect. Atf1 and Atf21 are bZIP transcription factors that are most closely related to human ATF-2/CRE-BP1. Spc1 is required for stress-induced phosphorylation of Atf1. Atf1 is required for induction of meiotic genes and stress-response genes, such as gpd1+ and pyp2+, that are transcriptionally regulated by Spc1. atf1- and spc1- mutants are sensitive to osmotic stress and impaired for sexual development, showing that fission yeast uses a common pathway to respond to cytotoxic stress and nitrogen starvation. However, unlike spc1- mutants, atf1- cells have no mitotic cell-cycle defect, indicating that the stress response pathway bifurcates at Spc1 to regulate independently meiosis and mitosis.