Fusarium heterosporum produces a solvent-tolerant lipase, and we previously succeeded in cloning the lipase cDNA. The present study was undertaken to express the cDNA using Saccharomyces cerevisiae. The expression plasmid was constructed by ligating the cDNA (coding signal peptide, propeptide, and mature lipase) between the GAP (the gene coding glyeeraldehyde-3-phosphate dehydrogenase of S. cerevisiae) promoter and its terminator. Five S. cerevisiae strains transformed with the resulting plasmid secreted the lipase into the culture supernatant, although their productivities differed. The transformant producing lipase at the highest level, 10 U/ml, was selected, and the medium composition was examined with the aim of further elevating production. The lipase was produced most effectively in a medium containing 3% yeast extract, 1% peptone, and 4% sucrose; the production attained 78 U/ml, corresponding to 39 mu g/ml lipase. The lipase produced by S. cerevisiae was purified by DEAE-Sephadex A-50 ion-exchange chromatography and Sephadex G-75 gel filtration, and by SP-Sephadex C-50 ion-exchange chromatography. At the final purification step, the activity was separated into two fractions. One fraction contained a homogeneous 32-kDa protein and the other was composed of several proteins (34-38 kDa). Since the properties of the 32-kDa enzyme agreed with those of the lipase from F. heterosporum, including solvent-tolerance, it could be confirmed that the cloned cDNA coded the lipase. It was further suggested that S. cerevisiae possesses processing tools, which contain a signal peptidase and a trypsin-like proteinase cleaving a propeptide, similar to those existing in F. heterosporum. The finding that the 34-38-kDa enzymes did not contain carbohydrate, suggests that they were generated by post-translational modification and not by glycosylation.