We have cloned the region from MAT to THR4 on chromosome III of Saccharomyces cerevisiae. Although the region is only 15 kb, the two loci are genetically separated by 22 cM. This is in sharp contrast to the very low level of recombination (2 cM in 22 kb) that is observed in the adjacent CRY1-MAT interval, and suggests that there may be a "hot spot" for recombination in the MAT-THR4 region. The DNA sequence of the first 4.4 kb distal to MAT reveals an open reading frame that we have identified as the essential gene, TSM1. Surprisingly, the TSM1 open reading frame of 1,410 amino acids extends into the MAT locus, such that the 3'-end of the MAT alpha 1 transcript ends 15 bp from the 3'-end of the TSM1 open reading frame.