K1 killer toxin secreted by the K1 strain of Saccharomyces cerevisiae, has been well characterized. It is a simple protein of molecular weight (MW) 11,470 (ref. 3), encoded by a double-stranded, linear RNA plasmid, called M RNA, of MW 1.1-1.7 x 10(6) (refs 4-6). It is lethal to sensitive Saccharomyces cerevisiae which does not carry M RNA. Leakage of K+ and ATP is the first distinct response in sensitive cells, and the toxic action is thought to be due to its action as a protonophore or K+ ionophore. Recently, a further killer toxin has been found in Kluyveromyces lactis IFO 1267, and it is associated with the presence of the double-stranded linear DNA plasmids, pGK1-1 (MW 5.4 x 10(6)) and pGK1-2 (MW 8.4 x 10(6)). It has been shown, by curing pGK1-1 or deletion mapping, that the structural gene for the killer toxin and immunity-determining gene reside on the smaller plasmid. Moreover, the plasmids could be transferred from K. lactis to S. cerevisiae by protoplast fusion and protoplast transformation. As the K. lactis toxin is encoded by a DNA plasmid and has a relatively wider action spectrum than K1 killer toxin, the mode of action of the toxin is highly interesting. Here we report that K. lactis toxin inhibits adenylate cyclase in sensitive yeast cells and brings about arrest of the cells at the G1 stage.