Phosphorylated inositol phospholipids (phosphoinositides) regulate a multitude of cellular functions via downstream lipid-binding effector proteins. Phosphoinositide-controlled processes include cytoskeletal organization, gene expression, cell proliferation and membrane trafficking. The increasing interest in phosphoinositides is fueled by evidence that they are related to the development of human diseases. In particular, mutations in genes encoding lipid phosphatases were linked to a variety of severe maladies such as serious congenital disorders, diabetes, and cancer. Thus, the characterization of these enzymes and of the cellular function they perform assumes considerable biomedical relevance. The central hypothesis of this study proposes a pivotal role for the Sac1 lipid phosphatase in coordinating endoplasmic reticulum (ER) and Golgi function in response to nutrients and cell growth rates. Our preliminary data show that dolicholphosphate mannose synthase Dpmlp, an essential ER enzyme involved in glycosylation, recruits Saclp to ER membranes during times of rapid cell division. Nutrient limitation slows cell proliferation and triggers dissociation of Sac1p from Dpm1p, causing accumulation of this lipid phosphatase at the Golgi. The goal of this proposal is to understand how cell growth-specific distribution of Sac1p between ER and Golgi is regulated and how this process coordinates the secretory capacity of these organelles. We will characterize the mechanisms for cell growth-dependent localization of Sac1p using genetic and biochemical analyses. We will also employ fluorescent lipid-binding probes to identify Sac1 -controlled pools of phosphoinositides and examine their role in membrane trafficking and organellar function. Characterization of the specific functions of the Sac1 lipid phosphatase will increase our knowledge of how the specificity of dynamical processes at the membranes of secretory organelles is achieved. Insight into the regulation of lipid signals at ER and Golgi membranes will also improve our understanding of the organization of the secretory pathway.