The enzyme acetyl-CoA:isopenicillin N acyltransferase (IAT) is a peroxisomal enzyme that mediates the final step of penicillin biosynthesis in the filamentous fungi Penicillium chrysogenum and Aspergillus nidulans. However, the precise role of peroxisomes in penicillin biosynthesis is still not clear. To be able to use the power of yeast genetics to solve the function of peroxisomes in penicillin biosynthesis, we introduced IAT in the yeast Hansenula polymorpha. To this purpose, the P. chrysogenum penDE gene, encoding IAT, was amplified from a cDNA library to eliminate the three introns and introduced in H. polymorpha. In this organism IAT protein was produced as a 40 kDa pre-protein and, as in P. chrysogenum, processed into an 11 and 29 kDa subunit, although the efficiency of processing seemed to be slightly reduced relative to P. chrysogenum. The P. chrysogenum IAT, produced in H. polymorpha, is normally localized in peroxisomes and in cell-free extracts IAT activity could be detected. This is a first step towards the introduction of the penicillin biosynthesis pathway in H. polymorpha.