A 6.6 kb genomic DNA fragment from the yeast Kluyveromyces lactis was isolated. Sequence analysis of this fragment revealed the presence of two incomplete open reading frames (ORFs) in one strand, one coding for the carboxyl terminus of the plasma membrane H(+)-ATPase and the other for the amino terminus of an unidentified product. In the complementary strand, a full-length ORF which encodes for a protein homologous to the yeast NADPH-dependent Old Yellow Enzyme was found. The deduced amino acid sequence of this ORF predicts a protein of 398 residues with 84% similarity in its full length to OYE1 from Saccharomyces carlsbergensis and OYE2 from Saccharomyces cerevisiae. In addition, an internal region showed considerable similarity to the bile acid-inducible polypeptide from Eubacterium sp., to the NADH oxidase from Thermoanaerobium brockii, to the trimethylamino dehydrogenase from bacterium W3A1 and to the estrogen-binding protein from Candida albicans, suggesting a functional or structural relationship between them. Inactivation of the KYE1 (Kluyveromyces Yellow Enzyme) gene by deletion of 0.6 kb fragment between positions +358 and +936 produced viable cells with a slight increase in their generation time. Haploid cells carrying the disrupted allele showed one-third of the NADPH oxidase activity, compared to wild-type cells. Southern blotting analysis of digested DNA and chromosomes separated by contour-clamped homogeneous electric field electrophoresis from K. lactis indicated that this is a single-copy gene and it is localized on chromosome II, whose molecular size has been estimated to be approximately 1.3 Mb.