In Drosophila, the MSL complex is required for the dosage compensation of X-linked genes in males and contains a histone acetyltransferase, MOF. A point mutation in the MOF acetyl-CoA-binding site results in male-specific lethality. Yeast Esa1p, a MOF homolog, is essential for cell cycle progression and is the catalytic subunit of the NuA4 acetyltransferase complex. Here we report that NuA4 purified from yeast with a point mutation in the acetyl-CoA-binding domain of Esa1p exhibits a strong decrease in histone acetyltransferase activity, yet has no effect on growth. We demonstrate that Eaf3p (Esa1p-associated factor-3 protein), a yeast protein homologous to the Drosophila dosage compensation protein MSL3, is also a stable component of the NuA4 complex. Unlike other subunits of the complex, it is not essential, and the deletion mutant has no growth phenotype. NuA4 purified from the mutant strain has a decreased apparent molecular mass, but retains wild-type levels of histone H4 acetyltransferase activity. The EAF3 deletion and the ESA1 mutation lead to a decrease in PHO5 gene expression; the EAF3 deletion also significantly reduces HIS4 and TRP4 expressions. These results, together with those previously obtained with both the MSL and NuA4 complexes, underscore the importance of targeted histone H4 acetylation for the gene-specific activation of transcription.