Aft1p is an iron-responsive transcriptional activator that plays a central role in the regulation of iron metabolism in Saccharomyces cerevisiae. Aft1p is regulated by accelerated nuclear export in the presence of iron, mediated by Msn5p. However, the transcriptional activity of Aft1p is suppressed under iron-replete conditions in the Δmsn5 strain, although Aft1p remains in the nucleus. Aft1p dissociates from its target promoters under iron-replete conditions due to an interaction between Aft1p and the monothiol glutaredoxin Grx3p or Grx4p (Grx3/4p). The binding of Grx3/4p to Aft1p is induced by iron repletion and requires binding of an iron-sulfur cluster to Grx3/4p. The mitochondrial transporter Atm1p, which has been implicated in the export of iron-sulfur clusters and related molecules, is required not only for iron binding to Grx3p but also for dissociation of Aft1p from its target promoters. These results suggest that iron binding to Grx3p (and presumably Grx4p) is a prerequisite for the suppression of Aft1p. Since Atm1p plays crucial roles in the delivery of iron-sulfur clusters from the mitochondria to the cytoplasm and nucleus, these results support the previous observations that the mitochondrial iron-sulfur cluster assembly machinery is involved in cellular iron sensing.