Strains of Saccharomyces cerevisiae transformed with a multicopy expression vector bearing both the Escherichia coli beta-galactosidase gene under the control of the upstream activating sequence of the GAL1-10 genes and the GAL4 activator gene release part of beta-galactosidase in the growth medium. This release is due to cell lysis of the older mother cells; the enzyme maintains its activity in buffered growth media. Fermentation studies with transformed yeast strains showed that the release of beta-galactosidase allowed an efficient growth on buffered media containing lactose as carbon source as well as on whey-based media. The transformed strains utilized up to 95% of the lactose and a high growth yield was obtained in rich media. High productions of ethanol were also observed in stationary phase after growth in lactose minimal media.