The green fluorescent protein (GFP) from the jellyfish Aequorea victoria has attracted much attention as a tool to study a number of biological processes. This study describes the use of GFP as a vital reporter molecule for localization and expression studies in Saccharomyces cerevisiae. Construction of GFP expression vectors which allow N- or C-terminal fusion of the gfp gene to a gene of interest allowed the generation of fusion proteins whose subcellular localization was followed by fluorescence microscopy in living yeast cells. Analysis of three unknown open reading frames obtained from the budding yeast chromosome XIV resulted in distinct staining patterns, allowing prediction of the cellular localization of these unknown proteins. Furthermore, GFP was used to construct a gene replacement cassette which, after homologous integration into the genomic locus, placed the gfp gene behind a promoter of interest. The amount of GFP produced from this promoter was then quantified in living yeast cells by flow cytometry. With this novel replacement cassette a gene of interest can be deleted and at the same time its expression level studied under various growth conditions. The experiments presented here suggest that GFP represents a convenient fluorescent marker for localization studies as well as gene expression studies in budding yeast. Systematic studies of a large number of genes should benefit from such assays.