Chitin deacetylase (EC 184.108.40.206), which hydrolyses the N-acetamido groups of N-acetyl-D-glucosamine residues in chitin, has been demonstrated in crude extracts from sporulating Saccharomyces cerevisiae. Two S. cerevisiae open reading frames (ORFs), identified by the Yeast Genome Project, have protein sequence homology to a chitin deacetylase from Mucor rouxii. Northern blot hybridizations show each ORF was transcribed in diploid cells after transfer to sporulation medium and prior to formation of asci. Each ORF was cloned in a vector under transcriptional control of the GAL 1, 10 promoter and introduced back into haploid strains of S. cerevisiae. Chitin deacetylase activity was detected by in vitro assays from vegetative cells grown in galactose. Chemical analysis of these cells also demonstrated the synthesis of chitosam in vivo. Both recombinant chitin deacetylases showed similar qualitative and quantitative activities toward chitooligosaccharides in vitro. A diploid strain deleted to both ORFs, when sporulated, did not show deacetylase activity. The mutant spores were hypersensitive to lytic enzymes (Glusulase or Zymolyase).