The mitochondrial F1-ATPase is a multimeric enzyme, comprised of 3alpha, 3beta, gamma, delta and epsilon subunits, that is primarily responsible for the synthesis of ATP in eukaryotic cells. Recent work has shown that the F1 complex of the petite-negative yeast Kluyveromyces lactis, with specific mutations in the alpha, beta or gamma subunits, has a novel function that suppresses lethality caused by loss of mtDNA. Previously, genes for the four largest subunits of K. lactis F1 have been identified and characterised. In this study the gene coding for the epsilon-subunit of F1, KlATPepsilon, has been isolated and found to encode a polypeptide of 61 amino acids with only 32 residues identical to those in the protein from Sacharomyces cerevisiae. Strains carrying a null mutation of KlATPepsilon are respiratory deficient while the introduction of ATPepsilon from S. cerevisiae restores growth on non-fermentable carbon sources. In contrast to S. cerevisiae, K. lactis disrupted in ATPepsilon does not have a detectable F1-related mitochondrial ATP hydrolysis activity, suggesting that the epsilon-subunit plays a critical role in the formation of the catalytic sector of F1. With a disrupted KlATPepsilon, the rho degrees-lethality suppressor function of F1 carrying the atp2-1 and atp1-6 alleles is abolished. However, inactivation of the epsilon subunit does not eliminate the rho degrees-viable phenotype of the atp1-1, atp2-9, atp3-2 mutants. It is suggested that the absence of epsilon may effect the assembly or stability of F in the wild-type, atp 2-1 and atp1-6 strains, whereas the defect can be suppressed by the atp1-1, atp2-9 and atp3-2 mutations in the alpha, beta and gamma subunits respectively.