In Saccharomyces cerevisiae-136ts (Hutchison, H.T., Hartwell, L.H. and McLaughlin, C.S. (1969) J. Bacteriol. 99, 807--814) derepressed acid phosphatase was almost exclusively located outside the permeability barrier. Only a minor part of the activity was associated with the protoplasts; about half of it (48%) in the soluble fraction, the rest bound to the internal (45%) and plasma (7%) membranes. The activity found in the membranes of derepressed cells decreased by 30--40% after addition of inorganic phosphate or cycloheximide suggesting that this activity is the precursor of the external enzyme. The alkaline phosphatase activity level could not be modified by changes in the concentration of inorganic phosphate. Acid phosphatase was not synthesized if the cells were transferred to a low phosphate medium at the moment of incubation at 37 degrees C or in the presence of cycloheximide at 23 degrees C. The data suggested that enzyme formation is the result of the transcription and translation of a specific gene(s) and not the activation of a proenzyme. Inorganic phosphate did not inhibit the translation of mRNA though it may act at the level of the transcription.