We have cloned and characterized a Saccharomyces cerevisiae gene YRR1 that is important for resistance to the mutagen 4-nitroquinoline N-oxide (4-NQO). The wild-type YRR1 gene encodes a protein that contains a Zn(II)2Cys6-type zinc-finger motif. Disruption of the YRR1 gene leads to hypersensitivity to 4-NQO. A dominant mutation (YRR1-1) that confers strong resistance to 4-NQO has been identified. Epistasis analysis demonstrated that 4-NQO resistances mediated by the YRR1 and YRR1-1 alleles require the presence of the SNQ2 gene that encodes a multidrug resistance ATP binding cassette superfamily protein responsible for 4-NQO export. Northern blot analysis of SNQ2 mRNA levels indicated that Yrr1p is involved in basal and drug-induced transcriptional activation of SNQ2, whereas Pdr1p/Pdr3p transcription factors are mainly involved in basal SNQ2 expression. In the YRR1-1 mutant, the level of SNQ2 mRNA is constitutively elevated. These results establish that Yrr1p is important for 4-NQO resistance by mediating transcriptional activation of the SNQ2 gene in response to the stress imposed by 4-NQO. The gain-of-function mutation of Yrr1-1p was attributable to the duplication of a 12-amino-acid sequence generated near the carboxy terminus.