One-carbon units are essential to a variety of anabolic processes which yield necessary cellular components including purines, pyrimidines, amino acids, and lipids. Serine hydroxymethyltransferase (SHMT) is the major provider of one-carbon units in the cell. The other product of this reaction is glycine. Both of these metabolites are required in de novo purine biosynthesis. In Saccharomyces cerevisiae, mitochondrial and cytoplasmic SHMT isozymes are encoded by distinct nuclear genes (SHM1 and SHM2). Molecular genetic analyses have begun to define the roles of these two isozymes in folate-mediated one-carbon metabolism [McNeil, J. B., et al. (1996) Genetics 142, 371-381]. In our study, the SHM1 and SHM2 genes were disrupted singly and in combination to investigate the contributions of the two SHMT isozymes to the production of glycine and one-carbon units required in purine biosynthesis. Cell subfractionation experiments indicated that while only 5% of total activity was localized in the mitochondria, the specific activity in that compartment was much higher than in the cytoplasm. Growth and 13C NMR experiments indicate that the two isozymes function in different directions, depending on the nutritional conditions of the cell. When yeast was grown on serine as the primary one-carbon source, the cytoplasmic isozyme was the main provider of glycine and one-carbon groups for purine synthesis. When grown on glycine, the mitochondrial SHMT was the predominant isozyme catalyzing the synthesis of serine from glycine and one-carbon units. However, when both serine and glycine were present, the mitochondrial SHMT made a significant contribution of one-carbon units, but not glycine, for purine synthesis. Finally, NMR data are presented that suggest the existence of at least two sites of de novo purine biosynthesis in growing yeast cells, each being fed by distinct pools of precursors.