Abstract 1. 1. The addition of brain tissue extracts to a yeast extract capable of rapid alcoholic fermentation at pH 6.0 brings about a fall in the rate of carbon dioxide evolution in the presence of sucrose. 2. 2. The inhibition of yeast fermentation is due to a thermolabile constituent of the brain tissue extract. There is no evidence that the inhibition is due to destruction of a yeast dehydrogenase. 3. 3. Lactic acid accumulates when a brain tissue extract is incubated with an extract of yeast. 4. 4. The inhibitory action of a brain tissue extract on yeast fermentation of glucose is partially neutralized by the presence of nicotinamide (0.011 M ). The rate of formation of lactic acid is also greatly increased under these circumstances. 5. 5. Lysed red blood cells, extracts of tumors, and dialyzed muscle extracts have similar effects to that of a brain extract in converting alcoholic fermentation of yeast (extracts) into glycolysis. 6. 6. The results are explained by the presence in animal tissue extracts of diphosphopyridine nucleosidase (DPN-ase) and diphosphopyridine nucleotide (DPN)-linked lactic dehydrogenase. The former enzyme causes a drop in alcoholic fermentation due to destruction of DPN. The latter enzyme causes both a drop in the rate of alcoholic fermentation and a rise in the rate of lactic acid formation owing to its competition with carboxylase for pyruvic acid produced during the breakdown of glucose. It is the circumstance that the lactic dehydrogenase of animal tissues is DPN-linked, whereas that of yeast is not DPN-linked, which is largely responsible for the fact that in a mixture of yeast and animal tissue extracts the process of alcohol formation from glucose is largely converted to glycolysis.