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Budding in the yeast Saccharomyces cerevisiae involves a polarized deposition of new cell surface material that is associated with a highly asymmetric disposition of the actin cytoskeleton. Mutants defective in gene CDC24, which are unable to bud or establish cell polarity, have been of great interest with regard to both the mechanisms of cellular morphogenesis and the mechanisms that coordinate cell-cycle events. To gain further insights into these problems, we sought additional mutants with defects in budding. We report here that temperature-sensitive mutants defective in genes CDC42 and CDC43, like cdc24 mutants, fail to bud but continue growth at restrictive temperature, and thus arrest as large unbudded cells. Nearly all of the arrested cells appear to begin nuclear cycles (as judged by the occurrence of DNA replication and the formation and elongation of mitotic spindles), and many go on to complete nuclear division, supporting the hypothesis that the events associated with budding and those of the nuclear cycle represent two independent pathways within the cell cycle. The arrested mutant cells display delocalized cell- surface deposition associated with a loss of asymmetry of the actin cytoskeleton. CDC42 maps distal to the rDNA on chromosome XII and CDC43 maps near lys5 on chromosome VII.