Part of the vacuole in the mother cell of Saccharomyces cerevisiae is segregated early in the cell cycle to establish a new vacuole in the bud. Investigation of the molecular mechanism of vacuolar segregation has previously been limited by the lack of an efficient screen for mutants defective in this process. We developed a new screening procedure based on a cascade for activation of vacuolar proteases. Carboxypeptidase Y (CPY) is activated by proteinase A (PrA). However, upon PrA depletion, CPY continues to be activated, supposedly by self-sustaining proteinase B (PrB) activity that is transferred from one generation to the next generation through vacuolar segregation. In this study fourteen mutants were isolated that failed to sustain CPY activation upon PrA depletion. While these mutants had altered vacuolar protease-activity levels, two mutants showed specific vacuolar segregation defects. They formed large-budded cells that contained no vacuole or extremely small vacuoles in the bud. These mutants represented two complementation groups, named VAC6 and VAC7. The data indicate that constitutive vacuolar segregation mutants are viable, but that they are unable to transfer proteolytic activities from mother vacuole to the bud. Surprisingly, despite the apparent lack of quantitative vacuolar inheritance, all daughter cells of vac6 and vac7 had obtained a vacuole before cell division.