The sexual development and virulence of the fungal pathogen Cryptococcus neoformans is controlled by a bipolar mating system determined by a single locus that exists in two alleles, ␣ and a. The ␣ and a mating-type alleles from two divergent varieties were cloned and sequenced. The C. neoformans mating-type locus is unique, spans >100 kb, and contains more than 20 genes. MAT-encoded products include homologs of regulators of sexual development in other fungi, pheromone and pheromone receptors, divergent components of a MAP kinase cascade, and other proteins with no obvious function in mating. The ␣ and a alleles of the mating-type locus have extensively rearranged during evolution and strain divergence but are stable during genetic crosses and in the population. The C. neoformans mating-type locus is strikingly different from the other known fungal mating-type loci, sharing features with the self-incompatibility systems and sex chromosomes of algae, plants, and animals. Our study establishes a new paradigm for mating-type loci in fungi with implications for the evolution of cell identity and self/nonself recognition.Self/nonself recognition events underlie the function of the major histocompatibility locus in defense against infection and organ transplant rejection, the self-incompatibility systems that prevent inbreeding in plants, and the production of offspring by sexual reproduction. During sexual reproduction, specialized genomic regions promote self/nonself interactions. Sexdetermining regions include the mating-type loci in fungi and the sex chromosomes in plants and animals. Dimorphic sex chromosome systems independently evolved in animals, mosses, and dioecious plants. A related but distinct sexual incompatibility system is found in many lower eukaryotes, including algae, protozoans, monoecious plants, and fungi. In these organisms, multiallelic mating-type (MAT) loci monitor cell interactions for sexual compatibility, and if inbreeding is detected, mating is aborted (17,18,50,56).A common theme of sex determinants is the need to be transmitted as a single unit, and recombination within sexdetermining regions is suppressed to avoid generating selffertile or sterile offspring. Several mechanisms operate to suppress recombination. In the fungal MAT loci, extensive sequence divergence prevents recombination between different alleles. In the case of sex chromosomes, both sequence divergence and chromosomal rearrangements suppress recombination. These rearrangements affect nearly the entire sex chromosome in humans or mice, whereas in lower vertebrates and certain dipterous insects, only a limited region of the sex chromosomes is rearranged. These findings suggest that the dimorphic sex chromosomes evolved via accumulation of chromosomal aberrations.Fungal mating-type loci serve as paradigms for understanding gene regulation during sexual development and the determination of cell fate and identity (7,16,32,34,37,40,54). Sexual development of ascomycetous fungi is commonly controlled by a bipolar mating syste...