The Saccharomyces cerevisiae protein MSS4 is essential and homologous to mammalian phosphatidylinositol-4-phosphate (PI(4)P) 5-kinases. Here, we demonstrate that MSS4 is a lipid kinase. MSS4 has dual substrate specificity in vitro, converting PI(4)P to PI(4, 5)P2 and to a lesser extent PI(3)P to PI(3,4)P2; no activity was detected with PI or PI(5)P as a substrate. Cells overexpressing MSS4 contain an elevated level specifically of PI(4,5)P2, whereas mss4 mutant cells have only approximately 10% of the normal amount of this phosphorylated phosphoinositide. Furthermore, cells lacking MSS4 are unable to form actin cables and to properly localize their actin cytoskeleton during polarized cell growth. Overexpression of RHO2, encoding a Rho-type GTPase involved in regulation of the actin cytoskeleton, restores growth and polarized distribution of actin in an mss4 mutant. These results suggest that MSS4 is the major PI(4)P 5-kinase in yeast and provide a link between phosphoinositide metabolism and organization of the actin cytoskeleton in vivo.