The CCAAT-binding factor is a conserved heteromeric transcription factor that binds to CCAAT box-containing upstream activation sites (UASs) within the promoters of numerous eukaryotic genes. The CCAAT-binding factor of Saccharomyces cerevisiae activates the transcription of these genes in response to growth in a nonfermentable carbon source. Previous studies have demonstrated that the HAP2, HAP3, and HAP4 subunits of the yeast CCAAT-binding factor are required for the transcriptional activation of genes containing a CCAAT box. Using the two-hybrid screening method, we have identified an additional component of the CCAAT-binding factor. We present the identification and characterization of a novel gene, HAP5, that encodes an additional subunit of the CCAAT-binding factor required for the assembly and DNA-binding activity of the complex. In a hap5 mutant, we show that CCAAT-binding activity is abolished in vitro. Furthermore, we demonstrate that purified recombinant HAP2, HAP3, and HAP5 are able to reconstitute CCAAT-binding activity in mobility shift analysis. These data suggest that the HAP2/3/5 heterotrimer represents a unique DNA-binding factor in which all three subunits of the complex are absolutely required for DNA-binding activity.