A gene, PDE2, has been cloned from the yeast Saccharomyces cerevisiae that, when present in high copy, reverses the phenotypic effects of RAS2vad9, a mutant form of the RAS2 gene that renders yeast cells sensitive to heat shock and starvation. It has previously been shown that the RAS proteins are potent activators of yeast adenylate cyclase. We report here that PDE2 encodes a high-affinity cAMP phosphodiesterase that shares sequence homology with animal cell phosphodiesterases. These results therefore imply that the effects of RAS2vi19 are mediated through its changes in cAMP concentration.Our laboratory group has been studying the mechanism of growth control in the yeast Saccharomyces cerevisiae with particular concentration on the functions of the RAS] and RAS2 genes, which are structurally and functionally homologous to the ras oncogenes of mammalian cells (1-4). At least one RASI or RAS2 gene is required for the continued growth of yeast cells (5, 6) and it has been shown that RAS genes are essential controlling elements for adenylate cyclase in yeast (2,7,8). A mutant RAS2 gene has been constructed that encodes valine at the 19th codon position instead of glycine (5). This mutant (RAS2vall9) is analogous to the mutant and oncogenic human Ha-ras gene, which was first recognized in the T24/EJ bladder cell line (9-11). Yeast cells that express the mutant RAS2vall9 gene fail to synthesize glycogen, show an abnormal sensitivity to starvation (8), show a defective ability to arrest in the G1 phase of the cell cycle (8), and are sensitive to heat shock (unpublished results). To better understand the mechanism of these effects, we have searched for yeast genes that, when present in high copy, reverse these phenotypic effects. One such gene has been found, and it encodes the high-affinity cAMP phosphodiesterase (PDEase) of S. cerevisiae. We here present the nucleotide sequence of this gene and describe some of the phenotypic consequences of its perturbation.