We have developed S. cerevisiae as a model system for mechanistic studies of the 26S proteasome. The subunits of the yeast 19S complex, or regulatory particle (RP), have been defined, and are closely related to those of mammalian proteasomes. The multiubiquitin chain binding subunit (S5a/Mcb1/Rpn10) was found, surprisingly, to be nonessential for the degradation of a variety of ubiquitin-protein conjugates in vivo. Biochemical studies of proteasomes from deltarpn10 mutants revealed the existence of two structural subassemblies within the RP, the lid and the base. The lid and the base are both composed of 8 subunits. By electron microscopy, the base and the lid correspond to the proximal and distal masses of the RP, respectively. The base is sufficient to activate the 20S core particle for degradation of peptides, but the lid is required for ubiquitin-dependent degradation. The lid subunits share sequence motifs with components of the COP9/signalosome complex, suggesting that these functionally diverse particles have a common evolutionary ancestry. Analysis of equivalent point mutations in the six ATPases of the base indicate that they have well-differentiated functions. In particular, mutations in one ATPase gene, RPT2, result in an unexpected defect in peptide hydrolysis by the core particle. One interpretation of this result is that Rpt2 participates in gating of the channel through which substrates enter the core particle.