Abstract: Monitoring Editor: Gero Steinberg Ste24 is a membrane-integral CaaX metalloprotease residing in the endoplasmic reticulum (ER). In yeast, the only known substrate of Ste24 is the mating factor a precursor. A global screening for protein-protein interactions indicated that Ste24 interacts with Chs3, an enzyme required for chitin synthesis. We confirmed this interaction by yeast two hybrid analyses and mapped the interacting cytoplasmic domains. Next we investigated the influence of Ste24 on chitin synthesis. In ste24Delta mutants we observed resistance to Calcofluor White (CFW), which was also apparent when the cells expressed a catalytically inactive version of Ste24. Additionally, ste24Delta cells showed a decrease in chitin levels and Chs3-GFP localized less frequently at the bud neck. Overexpression of STE24 resulted in hypersensitivity to CFW and a slight increase in chitin levels. The CFW phenotype of ste24Delta cells could be rescued by its human and insect orthologues. Although Chs3 binds to Ste24, it appears not to be a substrate for this protease. Instead, our data suggest that Chs3 and Ste24 form a complex in the ER that facilitates protease action on prenylated Chs4, a known activator of Chs3 with a C-terminal CaaX motif, leading to a more efficient localization of Chs3 at the plasma membrane.