Resistance to antifungal agents is a recurring and growing problem among patients with systemic fungal infections. UV-induced Aspergillus nidulans mutants resistant to terbinafine have been identified, and we report here the characterization of one such gene. A sib-selected, 6.6-kb genomic DNA fragment encodes a salicylate 1-monooxygenase (salA), and a fatty acid synthase subunit (fasC) confers terbinafine resistance upon transformation of a sensitive strain. Subfragments carrying salA but not fasC confer terbinafine resistance. salA is present as a single-copy gene on chromosome VI and encodes a protein of 473 amino acids that is homologous to salicylate 1-monooxygenase, a well-characterized naphthalene-degrading enzyme in bacteria. salA transcript accumulation analysis showed terbinafine-dependent induction in the wild type and the UV-induced mutant Terb7, as well as overexpression in a strain containing the salA subgenomic DNA fragment, probably due to the multicopy effect caused by the transformation event. Additional naphthalene degradation enzyme-coding genes are present in fungal genomes, suggesting that resistance could follow degradation of the naphthalene ring contained in terbinafine.