To gauge the complexity of gene regulation in yeast, it is essential to know how much promoter sequence is functional. Conservation across species can be a sensitive means of detecting functional sequences, provided that the significance of conservation can be accurately calibrated with the local neutral mutation rate. By analyzing yeast coding and promoter sequences, we find that neutral mutation rates in yeast are uniform genome-wide, in contrast to mammals, where neutral mutation rates vary along chromosomes. We develop an approach that uses this uniform rate to estimate the amount of promoter sequence under purifying selection. This amount is ∼30%, corresponding to roughly 90 bp for a typical promoter. Furthermore, using a hidden Markov model, we are able to separate each promoter into distinct high and low conservation regions. Known regulatory motifs are strongly biased toward high conservation regions, while low conservation regions have mutation rates similar to that of the neutral background. Certain Gene Ontology groupings of genes (e.g., Carbohydrate Metabolism) have large amounts of high conservation sequence, suggesting complexity in their transcriptional regulation. Others (e.g., RNA Processing) have little high conservation sequence and are likely to be simply regulated. The separation of functionally conserved sequence from the neutral background allows us to estimate the complexity of cis-regulation on a genomic scale.[Supplemental material is available online at www.genome.org and http://genome.ucsf.edu/YeastReg.]The regulation of gene expression is a universal, yet complex, process in biological systems. In the model organism Saccharomyces cerevisiae, several hundred transcription factors are thought to be involved in the regulation of ∼6000 genes (Gene Ontology Consortium 2000; Dolinski et al. 2004). Much of this regulation is mediated by transcription-factor-binding sites in promoter sequences, making knowledge of these sites essential for understanding the logic of cis-regulation. One promising approach for detecting binding sites is phylogenetic footprinting, the identification of selectively constrained elements by their conservation across species. For example, the genome sequences of S. cerevisiae and several of its close relatives have been used to predict motifs likely to describe transcription-factor-binding sites (Chiang et al. 2003;Cliften et al. 2003;Kellis et al. 2003;Pritsker et al. 2004;Siddharthan et al. 2004;Tanay et al. 2004).Although a number of transcription factors and binding motifs have been studied in detail, some basic parameters of transcriptional regulation are not known. One important feature that has not been characterized is the amount of functional sequence under purifying selection in yeast promoters. This is crucial for assessing how many transcription factors bind a typical promoter, how prevalent combinatorial control is, and whether regulation is more complex for particular gene families.Inspection of aligned yeast promoters shows rich structure in conserva...