DescriptionIn the yeast Saccharomyces cerevisiae, the DGK1-encoded diacylglycerol (DAG) kinase catalyzes the CTP-dependent phosphorylation of DAG to form phosphatidate (PA). This enzyme, in conjunction with PAH1-encoded PA phosphatase, controls the levels of PA and DAG for the synthesis of triacylglycerol (TAG) and membrane phospholipids, nuclear/endoplasmic reticulum (ER) membrane growth, and lipid droplet formation. In this work, we showed that a functional level of DAG kinase is regulated by the Reb1 transcription factor. Purified recombinant Reb1 was shown to specifically bind its consensus recognition sequence (CGGGTAA, -166 to -160) in the DGK1 promoter. Analysis of cells expressing the PDGK1-lacZ reporter gene showed that mutations (GTÆTG) in the Reb1-binding sequence caused an 8.6-fold reduction in β-galactosidase activity. The expression of DGK1(reb1), a DGK1 allele containing the Reb1-binding site mutation, was greatly lower than that of the wild type allele, as indicated by analyses of DGK1 mRNA, Dgk1, and DAG kinase activity. In the presence of cerulenin, an inhibitor of de novo fatty acid synthesis, the dgk1Δ mutant expressing DGK1(reb1) exhibited a significant defect in growth as well as in the synthesis of phospholipids from TAG mobilization. Unlike DGK1, the DGK1(reb1) expressed in the dgk1Δ pah1Δ mutant did not result in the nuclear/ER membrane expansion, which occurs in cells lacking PA phosphatase activity. These results indicate that the Reb1-mediated regulation of DAG kinase plays a major role in its in vivo functions in lipid metabolism. Treatment of membrane-solubilized and overexpressed Dgk1 with alkaline phosphatase caused a 7.7-fold decrease in DAG kinase activity, and the subsequent treatment with CKII caused a 5.5-fold increase in activity. A purified N-terminal fragment of Dgk1 (Dgk11-77) was phosphorylated by CKII on a serine residue in timeand dose-dependent manners, and the phosphorylation was dependent on the concentrations of Dgk11-77 and ATP. Ser-45 and Ser-46 were identified as the major CKII phosphorylation sites. Analysis of yeast expressing the phosphorylation-deficient mutants indicated that the stimulation of DAG kinase activity is attributed to the phosphorylation of Dgk1 by CKII. DAG kinase activity is required for deleterious phenotypes imparted by the pah1Δ mutation. The phosphorylation-deficient mutations inhibited the function that DAG kinase plays for defects in nuclear/ER membrane expansion and lipid droplet formation, as well as the temperature sensitivity caused by the pah1Δ mutation.