Proteins of the armadillo family are involved in diverse cellular processes in higher eukaryotes. Some of them, like armadillo, beta-catenin and plakoglobins have dual functions in intercellular junctions and signalling cascades. Others, belonging to the importin-alpha-subfamily are involved in NLS recognition and nuclear transport, while some members of the armadillo family have as yet unknown functions. Here, we introduce the Saccharomyces cerevisiae protein Yel013p as a novel armadillo (arm) repeat protein. The ORF Yel013w was identified in the genome project on chromosome V (EMBL: U18530) and codes for an acidic protein of 578 residues with 8 central arm-repeats, which are closely related to the central repeat-domain of Xenopus laevis plakoglobin. We show that Yel013p (Vac8p) is constitutively expressed in diploid and haploid yeasts and that it is not essential for viability and growth. However, the vacuoles of mutant cells are multilobular or even fragmented into small vesicles and the processing of aminopeptidase I, representing the cytoplasm-to-vacuole transport pathway, is strongly impaired. Consistent with these observations, subcellular fractionation experiments, immunolocalization and expression of green fluorescent protein (GFP) fusion proteins revealed that Yel013p (Vac8p) is associated with the vacuolar membrane. Our data provide evidence for the involvement of an arm-family member in vacuolar morphology and protein targeting to the vacuole.