Oxygen provides a crucial energy source in eukaryotic cells. Hence, eukaryotes ranging from yeast to humans have developed sophisticated mechanisms to respond to changes in oxygen levels. Regulation of protein localization, like protein modifications, can be an effective mechanism to control protein function and activity. However, the contribution of protein localization in oxygen signaling has not been examined on a genomewide scale. Here, we examine how hypoxia affects protein distribution on a genomewide scale in the model eukaryote, the yeast Saccharomyces cerevisiae. We demonstrate, by live cell imaging, that hypoxia alters the cellular distribution of 203 proteins in yeast. These hypoxia-redistributed proteins include an array of proteins with important functions in various organelles. Many of them are nuclear and are components of key regulatory complexes, such as transcriptional regulatory and chromatin remodeling complexes. Under hypoxia, these proteins are synthesized and retained in the cytosol. Upon reoxygenation, they relocalize effectively to their normal cellular compartments, such as the nucleus, mitochondria, endoplasmic reticulum, and cell periphery. The resumption of the normal cellular locations of many proteins can occur even when protein synthesis is inhibited. Furthermore, we show that the changes in protein distribution induced by hypoxia follow a slower trajectory than those induced by reoxygenation. These results show that the regulation of protein localization is a common and potentially dominant mechanism underlying oxygen signaling and regulation. These results may have broad implications in understanding oxygen signaling and hypoxia responses in higher eukaryotes such as humans.