The mgi1-4 and mgi2-1 mutants of the petite-negative yeast Kluyveromyces lactis have mutations in the beta- and alpha-subunits of the mitochondrial F1-ATPase, respectively. The mutants are respiratory competent but can form petites with deletions in mitochondrial DNA. In this study a cryptic nuclear mutation (lipB-1) was identified which, in combination with the mgi alleles, displays a synergistic respiratory-deficient phenotype on glycerol medium. The gene defined by the mutation was cloned and shown to encode a polypeptide of 332 amino acids with an N-terminal sequence characteristic of a mitochondrial targeting signal. The deduced protein shares 27% sequence identity with the product of the Escherichia coli lipB gene, which encodes a lipoyl-protein ligase involved in the attachment of lipoyl groups to lipoate-dependent apoproteins. A K. lactis strain carrying a disrupted lipB allele is severely compromised for growth on glycerol medium. The growth defect cannot be rescued by addition of lipoic acid, but cell growth can be restored on medium containing ethanol plus succinate. In addition, it was observed that lipB mutants of K. lactis, unlike the wild-type, are unable to utilize glycine as sole nitrogen source, indicating that activity of the glycine decarboxylase complex (GDC) is also affected. Taken together, these findings suggest that LIPB is the main determinant of the lipoyl-protein ligase activity required for lipoylation of enzymes such as alpha-ketoacid dehydrogenases and GDC.