Hydrogen peroxide (H2O2) is a key signaling molecule that also induces apoptosis. Thus, cells must rapidly sense and tightly control H2O2 levels. Well-characterized cellular responses to exogenous H2O2 involve oxidation of specific cytosolic protein-based thiols but sensing of H2O2 generated by mitochondrial respiration is less well described. Here we provide substantial biochemical evidence that the heme enzyme Ccp1 (cytochrome c peroxidase), which is targeted to the intermembrane space, functions primarily as a mitochondrial H2O2 sensing and signaling protein in Saccharomyces cerevisiae. Key evidence for a sensing role for Ccp1 is the significantly higher H2O2 accumulation in ccp1-null cells(ccp1Δ) vs ccp1W191F cells producing the catalytically inactive Ccp1W191F variant. In fact, intracellular H2O2 levels (ccp1Δ>wildtype >ccp1W191F) correlate inversely with the activity of the mitochondrial (and peroxisomal) heme catalase, Cta1 (ccp1Δ<wildtype <ccp1W191F). Mitochondrial Sod2 activity also varies in the three strains (ccp1Δ>wildtype >ccp1W191F) and ccp1Δ cells exhibit low superoxide levels. Notably, Ccp1W191F is a more persistent H2O2 signaling protein than wild-type Ccp1, and this enhanced mitochondrial H2O2 signaling decreases the mitochondrial fitness of ccp1W191F cells. However, these cells are fully protected from a bolus (0.4 mM) of exogenous H2O2 added after 12 h of growth, whereas the viability of ccp1Δ cells drops below 20%, which additionally associates Ccp1 with Yap1-dependent H2O2 signaling. Combined, our results strongly implicate Ccp1, independent of its peroxidase activity, in mitochondrial H2O2 sensing and signaling to maintain reactive oxygen species homeostasis.