SPX domains control phosphate homeostasis in eukaryotes.Ten genes in yeast encode SPX-containing proteins, among which YDR089W is the only one of unknown function. Here, we show that YDR089W encodes a novel subunit of the vacuole transporter chaperone (VTC) complex that produces inorganic polyphosphate (polyP). The polyP synthesis transfers inorganic phosphate (P i ) from the cytosol into the acidocalcisome-and lysosome-related vacuoles of yeast, where it can be released again. It was therefore proposed for buffer changes in cytosolic P i concentration (Thomas, M. R., and O'Shea, E. K. (2005) Proc. Natl. Acad. Sci. U.S.A. 102, 9565-9570). Vtc5 physically interacts with the VTC complex and accelerates the accumulation of polyP synthesized by it. Deletion of VTC5 reduces polyP accumulation in vivo and in vitro. Its overexpression hyperactivates polyP production and triggers the phosphate starvation response via the PHO pathway. Because this Vtc5-induced starvation response can be reverted by shutting down polyP synthesis genetically or pharmacologically, we propose that polyP synthesis rather than Vtc5 itself is a regulator of the PHO pathway. Our observations suggest that polyP synthesis not only serves to establish a buffer for transient drops in cytosolic P i levels but that it can actively decrease or increase the steady state of cytosolic P i .Phosphate is a limiting factor for the growth of living organisms. It is mainly taken up by the cells as P i and incorporated in biological molecules, including ATP, nucleic acids, and phospholipids. P i plays a major role in the regulation of biochemical pathways through phosphorylation, pyrophosphorylation, and polyphosphorylation. Its concentration affects the free energy liberated by the hydrolysis of ATP and other nucleoside di-and triphosphates. Therefore, P i homeostasis (import, usage, storage, and export) is regulated (1, 2), and P i can be accumulated and stored as a polymer of P i units called polyphosphate (polyP).3 One mode of regulation operates on the transcriptional level. The PHO pathway, which is a P i -dependent transcriptional program in yeast, has been extensively characterized (2). Transcription of the PHO genes is regulated by the transcription factors Pho4 and Pho2. Phosphorylated Pho2 interacts with Pho4 to induce expression of the PHO genes. Pho2 is a target of Cdc28 kinase in vitro suggesting a coordination between cell cycle progression and nutrient availability (3). Pho4 is itself regulated by the cyclin-dependent kinase Pho85 and its cyclin Pho80. Under P i -rich conditions, the Pho80-Pho85 complex phosphorylates Pho4, thereby restricting the localization of the transcription factor to the cytosol (4, 5). Under P i limitation, Pho80/Pho85 is inhibited, and the nonphosphorylated Pho4 is imported into the nucleus, allowing transcription of PHO genes. Pho80/85 is regulated by the cyclin-dependent kinase inhibitor Pho81. Inhibition of Pho80/85 by Pho81 is facilitated by the inositol pyrophosphate 1-IP 7 , which is produced by Vip1 (6). However,...