FK506 and rapamycin are related immunosuppressive compounds that block helper T cell activation by interfering with signal transduction. In vitro, both drugs bind and inhibit the FK506-binding protein (FKBP) proline rotamase. Saccharomyces cerevisiae cells treated with rapamycin irreversibly arrested in the G1 phase of the cell cycle. An FKBP-rapamycin complex is concluded to be the toxic agent because (i) strains that lack FKBP proline rotamase, encoded by FPR1, were viable and fully resistant to rapamycin and (ii) FK506 antagonized rapamycin toxicity in vivo. Mutations that conferred rapamycin resistance altered conserved residues in FKBP that are critical for drug binding. Two genes other than FPR1, named TOR1 and TOR2, that participate in rapamycin toxicity were identified. Nonallelic noncomplementation between FPR1, TOR1, and TOR2 alleles suggests that the products of these genes may interact as subunits of a protein complex. Such a complex may mediate nuclear entry of signals required for progression through the cell cycle.