A hybrid of Saccharomyces diastaticus x Hansenula capsulata was obtained by conversion of the S. diastaticus parent to a petite, protoplasting and fusion of the strains and isolation of the hybrids on selective media, containing glycerol or galactose. All of the single-ceU clones obtained resembled S. diastaticus in morphology, and fermented glucose, galactose, maltose, sucrose and starch. The hybrid sporulated, producing spores resembling those of S. diastaticus, but in asci which differed somewhat morphologically. The stability of the hybrid depended on the composition of the maintenance media, as hybrid clones maintained on glycerol medium lost their ability to sporulate after a few transfers and the cellular morphology altered to a form more closely resembling H. capsulata, and those maintained on glucose-containing medium lost the ability to utilize glycerol. Cultures maintained on yeast extract-starch medium retained the ability to sporulate and utilize glycerol. However, dissection of asci from the hybrid yielded clones, some of which had lost the ability to metabolize glycerol but which still spomlated. These clones had an unaltered cytochrome spectrum, and in other ways appeared to be respiratory competent. Washed cells of hybrids grown on galactose or starch as sole carbon source metabolized starch, as shown by respirometric measurements, but cells maintained on glycerol as sole carbon source had lost this ability. There was some evidence that the addition of vitamins stimulated oxygen uptake on starch by the hybrids. The formation of sporulating hybrids in the cross may permit the genetic analysis of other Saccharomyces x Hansenula crosses.