The eukaryotic cytoplasm has long been regarded as a cellular compartment in which the reduced state of protein cysteines is largely favored. Under normal conditions, the cytosolic low-molecular weight redox buffer, comprising primarily of glutathione, is highly reducing and reactive oxygen species (ROS) and glutathionylated proteins are maintained at very low levels. In the present review, recent progress in the understanding of the cytosolic thiol-disulfide redox metabolism and novel analytical approaches to studying cytosolic redox properties are discussed. We will focus on the yeast model organism, Saccharomyces cerevisiae, where the combination of genetic and biochemical approaches has brought us furthest in understanding the mechanisms underlying cellular redox regulation. It has been shown in yeast that, in addition to the enzyme glutathione reductase, other mechanisms may exist for restricting the cytosolic glutathione redox potential to a relatively narrow interval. Several mutations in genes involved in cellular redox regulation cause ROS accumulation but only moderate decreases in the cytosolic glutathione reducing power. The redox regulation in the cytosol depends not only on multiple cytosolic factors but also on the redox homeostasis of other compartments like the secretory pathway and the mitochondria. Possibly, the cytosol is not just a reducing compartment surrounding organelles with high oxidative activity but also a milieu for regulation of the redox status of more than one compartment. Although much has been learned about redox homeostasis and oxidative stress response several important aspects of the redox regulation in the yeast cytosol are still unexplained.