We have used a polymerase chain reaction strategy to identify in the yeast Saccharomyces cerevisiae genes of the mammalian calnexin/calreticulin family, and we have identified and isolated a single gene, CNE1. The protein predicted from the CNE1 DNA sequence shares some of the motifs with calnexin and calreticulin, and it is 24% identical and 31% similar at the amino acid level with mammalian calnexin. On the basis of its solubility in detergents and its lack of extraction from membranes by 2.5 M urea, high salt, and sodium carbonate at pH 11.5, we have established that Cne1p is an integral membrane protein. However, unlike calnexins, the predicted carboxyl-terminal membrane-spanning domain of Cne1p terminates directly. Furthermore, based on its changed mobility from 76 to 60 kDa after endoglycosidase H digestion Cne1p was shown to be N-glycosylated. Localization of the Cne1p protein by differential and analytical subcellular fractionation as well as by confocal immunofluorescence microscopy showed that it was exclusively located in the endoplasmic reticulum (ER), despite the lack of known ER retention motifs. Although six Ca(2+)-binding proteins were detected in the ER fractions, they were all soluble proteins, and Ca2+ binding activity has not been detected for Cne1p. Disruption of the CNE1 gene did not lead to inviable cells or to gross effects on the levels of secreted proteins such as alpha-pheromone or acid phosphatase. However, in CNE1 disrupted cells, there was an increase of cell-surface expression of an ER retained temperature-sensitive mutant of the alpha-pheromone receptor, ste2-3p, and also an increase in the secretion of heterologously expressed mammalian alpha 1-antitrypsin. Hence, Cne1p appears to function as a constituent of the S. cerevisiae ER protein quality control apparatus.