Iron is a vital micronutrient that functions as an essential cofactor in multiple biological processes, including oxygen transport, cellular respiration, and metabolic pathways, such as sterol biosynthesis. However, its low bioavailability at physiological pH frequently leads to nutritional iron deficiency. The yeast Saccharomyces cerevisiae is extensively used to study iron and lipid metabolisms, as well as in multiple biotechnological applications. Despite iron being indispensable for yeast ergosterol biosynthesis and growth, little is known about their interconnections. Here, we used lipid composition analyses to determine that changes in the pattern of sterols impair the response to iron deprivation of yeast cells. Yeast mutants defective in ergosterol biosynthesis display defects in the transcriptional activation of the iron-acquisition machinery and growth defects in iron-depleted conditions. The transcriptional activation function of the iron-sensing Aft1 factor is interrupted due to its mislocalization to the vacuole. These data uncover novel links between iron and sterol metabolisms that need to be considered when producing yeast-derived foods or when treating fungal infections with drugs that target the ergosterol biosynthesis pathway.