Tetrahydrofolate (vitamin B9) and its folate derivatives are essential cofactors in one-carbon (C1) transfer reactions and absolutely required for the synthesis of a variety of different compounds including methionine and purines. Most plants, microbial eukaryotes, and prokaryotes synthesize folate de novo. We have characterized an important enzyme in this pathway, the Saccharomyces cerevisiae FOL1 gene. Expression of the budding yeast gene FOL1 in Escherichia coli identified the folate biosynthetic enzyme activities dihydroneopterin aldolase (DHNA), 7,8-dihydro-6-hydroxymethylpterin-pyrophosphokinase (HPPK), and dihydropteroate synthase (DHPS). All three enzyme activities were also detected in wild-type yeast strains, whereas fol1Delta deletion strains only showed background activities, thus demonstrating that Fol1p catalyzes three sequential steps of the tetrahydrofolate biosynthetic pathway and thus is the central enzyme of this pathway, which starting from GTP consists of seven enzymatic reactions in total. Fol1p is exclusively localized to mitochondria as shown by fluorescence microscopy and immune electronmicroscopy. FOL1 is an essential gene and the nongrowth phenotype of the fol1 deletion leads to a recessive auxotrophy for folinic acid (5'-formyltetrahydrofolate). Growth of the fol1Delta deletion strain on folinic acid-supplemented rich media induced a dimorphic switch with haploid invasive and filamentous pseudohyphal growth in the presence of glucose and ammonium, which are known suppressors of filamentous and invasive growth. The invasive growth phenotype induced by the depletion of C1 carrier is dependent on the transcription factor Ste12p and the flocullin/adhesin Flo11p, whereas the filamentation phenotype is independent of Ste12p, Tec1p, Phd1p, and Flo11p, suggesting other signaling pathways as well as other adhesion proteins.