Haploid cells of budding yeast Saccharomyces cerevisiae respond to mating pheromones by inducing genes required for conjugation, arresting cell cycle progression, and undergoing morphological changes. The same cells respond to nutrient deprivation by altering budding pattern and inducing genes required for invasive growth. Both developmental alternatives to vegetative proliferation require the MAP kinase Kssl and the transcriptional transactivator Stel2. Using a two-hybrid screen for gene products that interact with Kssl, two homologous and previously uncharacterized loci (DIG1 and DIG2, for down-regulator of invasive growth) were identified. DIG2 is pheromone-inducible, whereas DIG1 is constitutively expressed. Digl~ colocalizes with Kssl in the nucleus, coimmunoprecipitates with Kssl from cell extracts in a pheromone-independent manner, and is phosphorylated by Kssl in immune complexes in a pheromone-stimulated manner. Kssl binds specifically to a GST-Digl fusion in the absence of any other yeast protein. Using the two-hybrid method, both Digl and Dig2 also interact with the other MAP kinase of the pheromone response pathway, Fus3.However, neither digl or dig2 single mutants, nor a digl dig2 double mutant, have a discernible effect on mating. In contrast, digl dig2 cells constitutively invade agar medium, whereas a digl dig2 stel2 triple mutant does not, indicating that Digl and Dig2 share a role in negatively regulating the invasive growth pathway. High-level expression of Digl suppresses invasive growth and also causes cells to appear more resistant to pheromone-imposed cell cycle arrest. Stel2 also binds specifically to GST-Digl in the absence of any other yeast protein. Collectively, these findings indicate that Digl, and most likely Dig2, are physiological substrates of Kssl and suggest that they regulate Stel2 function by direct protein-protein interaction.