We have independently identified and DNA sequenced the INO2 locus by its close proximity to the KIN1 locus in Saccharomyces cerevisiae. Mutant strains in which the INO2 chromosomal locus has been deleted show pleiotropic phenotypes under growth conditions of inositol/choline availability. Many ino2 delta cells show delocalized cell growth resulting in large cells having aberrant shapes. These mutant cells may display nuclear segregation or positioning defects as well as defects in bud formation. Furthermore, homozygous ino2 delta-1 diploids fail to sporulate. Previous studies have shown that INO2 mutants are defective in phospholipid synthesis due to an inability to derepress the INO1 gene, the structural gene for inositol-1-phosphate synthase. To identify and determine the function of Ino2p in yeast cells, we raised antibodies to a beta-galactosidase/Ino2 fusion protein. The INO2 open reading frame codes for a 304 amino acid protein with a calculated molecular weight of 39.7 kDa. Immunoblot analysis reveals two Ino2-specific proteins of approximately 44 and 46 kDa. The 44 kDa species is localized to the nucleus. Ino2p is believed to function as a positive transcriptional activator in phospholipid synthesis. Our results suggest that it affects additional pathways important to polarized cell growth and division perhaps by functioning as a more general transcriptional factor.