The two-hybrid system is a powerful technique for detecting protein-protein interactions that utilizes the well-developed molecular genetics of the yeast Saccharomyces cerevisiae. However, the full potential of this technique has not been realized due to limitations imposed by the components available for use in the system. These limitations include unwieldy plasmid vectors, incomplete or poorly designed two-hybrid libraries, and host strains that result in the selection of large numbers of false positives. We have used a novel multienzyme approach to generate a set of highly representative genomic libraries from S. cerevisiae. In addition, a unique host strain was created that contains three easily assayed reporter genes, each under the control of a different inducible promoter. This host strain is extremely sensitive to weak interactions and eliminates nearly all false positives using simple plate assays. Improved vectors were also constructed that simplify the construction of the gene fusions necessary for the two-hybrid system. Our analysis indicates that the libraries and host strain provide significant improvements in both the number of interacting clones identified and the efficiency of two-hybrid selections.