Dimethylallyl diphosphate, an isomer of isopentenyl diphosphate, is a common substrate of Mod5p, a tRNA modifying enzyme, and the farnesyl diphosphate synthase Erg20p, the key enzyme of the isoprenoid pathway. rsp5 mutants, defective in the Rsp5 ubiquitin-protein ligase, were isolated and characterized as altering the mitochondrial/cytosolic distribution of Mod5p. To understand better how competition for the substrate determines the regulation at the molecular level, we analyzed the effect of the rsp5-13 mutation on Erg20p expression. The level of Erg20p was three times lower in rsp5-13 compared to the wild type strain and this effect was dependent on active Mod5p. Northern blot analysis indicated a regulatory role of Rsp5p in ERG20 transcription. ERG20 expression was also impaired in pkc1Delta lacking a component of the cell wall integrity signaling pathway. Low expression of Erg20p in rsp5 cells was accompanied by low level of ergosterol, the main end product of the isoprenoid pathway. Additionally, rsp5 strains were resistant to nystatin, which binds to ergosterol present in the plasma membrane, and sensitive to calcofluor white, a drug destabilizing cell wall integrity by binding to chitin. Furthermore, the cell wall structure appeared abnormal in most rsp5-13 cells investigated by electron microscopy and chitin level in the cell wall was increased two-fold. These results indicate that Rsp5p affects the isoprenoid pathway which has important roles in ergosterol biosynthesis, protein glycosylation and transport and in this way may influence the composition of the plasma membrane and cell wall.