In response to nitrogen limitation, diploid yeast strains of Saccharomyces cerevisiae undergo a dimorphic transition to a filamentous growth form known as pseudohyphal growth. This developmental change can be classified into two distinct growing forms: invasive pseudohyphal growth and superficial pseudohyphal growth. We identified a yeast gene, SFG1, whose overexpression predominantly enhances superficial pseudohyphal growth when starved for nitrogen. Sfg1 has a sequence similarity to members of a family of transcriptional regulators of fungal development. Cells of a homozygous sfg1/sfg1 diploid strain have a serious defect in pseudohyphal growth, indicating that Sfg1 has an essential function for pseudohyphal development. Our analyses show that Sfg1 may act separately from mitogen-activated protein kinase (MAPK) pathway and cAMP-dependent protein kinase A (PKA) pathway.