Two independent pathways oJ transcriptional regulation that show functional homology have been identified in yeast. It has been demonstrated previously that SWI5 encodes a zinc finger DNA-binding protein whose transcription and cellular localization both are cell cycle regulated. We show that ACE2, whose zinc finger region is nearly identical to that of SWI5, shows patterns of cell cycle-regulated transcription and nuclear localization similar to those seen previously for SMTIS. Despite their similarities, SWI5 and ACE2 function in separate pathways of transcriptional regulation. SWI5 is a transcriptional activator of the HO endonuclease gene, whereas ACE2 is not. In contrast, ACE2 is a transcriptional activator of the CTSl gene (which encodes chitinase), whereas SWI5 is not. An additional parallel between the SWI5/HO pathway and the ACE2/CTS1 pathway is that HO and CTSl both are cell cycle regulated in the same way, and HO and CTSl both require the SWI4 and SWr6 transcriptional activators. Overproduction of either SWI5 or ACE2 permits transcriptional activation of the target gene from the other pathway, suggesting that the DNA-binding proteins are capable of binding in vivo to promoters that they do not usually activate. Chimeric SWI5/ACE2 protein fusion experiments suggest that promoter specificity resides in a domain distinct from the zinc finger domain.