We have characterized a Saccharomyces cerevisiae mutant strain that is hypersensitive to cyclosporin A (CsA) and FK506, immunosuppressants that inhibit calcineurin, a serine-threonine-specific phosphatase (PP2B). A single nuclear mutation, designated cev1 for calcineurin essential for viability, is responsible for the CsA-FK506-sensitive phenotype. The peptidyl-prolyl cis-trans isomerases cyclophilin A and FKBP12, respectively, mediate CsA and FK506 toxicity in the cev1 mutant strain. We demonstrate that cev1 is an allele of the VPH6 gene and that vph6 mutant strains fail to assemble the vacuolar H(+)-ATPase (V-ATPase). The VPH6 gene was mapped on chromosome VIII and is predicted to encode a 181-amino acid (21 kD) protein with no identity to other known proteins. We find that calcineurin is essential for viability in many mutant strains with defects in V-ATPase function or vacuolar acidification. In addition, we find that calcineurin modulates extracellular acidification in response to glucose, which we propose occurs via calcineurin regulation of the plasma membrane H(+)-ATPase PMA1. Taken together, our findings suggest calcineurin plays a general role in the regulation of cation transport and homeostasis.