Previous studies in the yeast Saccharomyces cerevisiae have proposed a vacuolar localization for Ath1, which is difficult to reconcile with its ability to hydrolyze exogenous trehalose. We used fluorescent microscopy to show that the red fluorescent protein mCherry fused to the C-terminus of Ath1, although mostly localized in the vacuole, was also targeted to the cell surface. Also, hybrid Ath1 truncates fused at their C-terminus with the yeast internal invertase revealed that a 131 amino acid N-terminal fragment of Ath1was sufficient to target the fusion protein to the cell surface, enabling growth of the suc2Δ mutant on sucrose. The unique transmembrane domain appeared to be indispensable for the production of a functional Ath1, and its removal abrogated invertase secretion and growth on sucrose. Finally, the physiological significance of the cell-surface localization of Ath1 was established by showing that fusion of the signal peptide of invertase to N-terminal truncated Ath1 allowed the ath1Δ mutant to grow on trehalose, whereas the signal sequence of the vacuolar-targeted Pep4 constrained Ath1 in the vacuole and prevented growth of this mutant on trehalose. Use of trafficking mutants that impaired Ath1 delivery to the vacuole abrogated neither its activity nor its growth on exogenous trehalose.