The response of Neurospora to changes in the availibility of exogenous arginine was investigated. Upon addition of arginine to the growth medium, catabolism is initiated within minutes. This occurs prior to expansion of the arginine pool or augmentation of catabolic enzyme levels. (Basal levels are approximately 25% of those found during growth in arginine-supplemented medium.) Catabolism of arginine is independent of protein synthesis, indicating that the catabolic enzymes are active but that arginine is not available for catabolism unless present in the medium. Upon exhaustion of the supply of exogenous arginine, catabolism ceases abruptly, despite an expanded arginine pool and induced levels of the catabolic enzymes. The arginine pool supports protein synthesis until the cells regain their normal capacity for endogenous arginine synthesis. These observations, combined with the known small level of induction of arginine catabolic enzymes, non-repressibility of most biosynthetic enzymes, and vesicular localization of the bulk of the arginine pool, suggest that compartmentation plays a significant role in controlling arginine metabolism in Neurospora.