Inositol biosynthesis was studied in soluble, cell extracts of a wild-type (Ino) strain of Saccharomyces cerevisiae. Two reactions were detected: (i) conversion of D-glucose-6-phosphate to a phosphorylated form of inositol, presumably inositol-1-phosphate (IP synthethase, EC5.5.1.4), and (ii) conversion of phosphorylated inositol to inositol (IP phosphatase, EC3.1.3.25). The in vitro rate of conversion of glucose-6-phosphate to inositol was proportional to incubaion time and enzyme concentration. The pH optimum was 7.0. The synthesis of inositol required oxidized nicotinamide adenine dinucleotide (NAD) and was stimulated byNH4C1 and MgC12. NADP substituted poorly for NAD, and NADH inhibitedthe reaction. Phosphorylated inositol accumulated in the absence of MgC12, suggesting that inositol-phosphate is an intermediate in the pathway and that Mg ions stimulate the dephosphorylation of inositol-phosphate. IP synthetase was inhibited approximately 20% in the presence of inositol in the reaction mixture at concentrations exceeding 1 mM. The enzyme was repressed approximately 50-fold when inositol was present in the growth medium at concentrations exceeding 50 muM. IP synthetase reached the fully repressed level approximately 10 h after the addition of inositol to logarithmic cultures grown in the absence of inositol. The specific activity of the enzyme increased with time in logarithmically growing cultures lacking inositol andapproached the fully depressed level as the cells entered stationary phase.