The PGS1 gene of Saccharomyces cerevisiae encodes phosphatidylglycerophosphate (PG-P) synthase. PG-P synthase activity is regulated by factors affecting mitochondrial development and through cross-pathway control by inositol. The molecular mechanism of this regulation was examined by using a reporter gene under control of the PGS1 gene promoter (PPGS1-lacZ). Gene expression subject to carbon source regulation was monitored both at steady-state level and during the switch between different carbon sources. Cells grown in a non-fermentable carbon source had beta-galactosidase levels 3-fold higher than those grown in glucose. A shift from glucose to lactate rapidly raised the level of gene expression, whereas a shift back to glucose had the opposite effect. In either a pgs1 null mutant or a rho mutant grown in glucose, PPGS1-lacZ expression was 30-50% of the level in wild type cells. Addition of inositol to the growth medium resulted in a 2-3-fold reduction in gene expression in wild type cells. In ino2 and ino4 mutants, gene expression was greatly reduced and was not subject to inositol regulation consistent with inositol repression being dependent on the INO2 and INO4 regulatory genes. PPGS1-lacZ expression was elevated in a cds1 null mutant in the presence or absence of inositol, indicating that the capacity to synthesize CDP-diacylglycerol affects gene expression. Lack of cardiolipin synthesis (cls1 null mutant) had no effect on reporter gene expression.