Abstract: Glutathione (GSH), L-gamma-glutamyl-L-cysteinyl-glycine, is the major low molecular weight thiol compound present in almost all eukaryotic cells. GSH degradation proceeds through the gamma-glutamyl cycle that is initiated, in all organisms, by the action of gamma-glutamyl transpeptidase. A novel pathway for the degradation of GSH is described that requires the participation of 3 previously uncharacterized genes in S.cerevisiae, DUG1 (YFR044c), DUG2 (YBR281c) and DUG3 (YNL191w) (Defective in Utilization of Glutathione). Although dipeptides and tripeptides with a normal peptide bond such as cys-gly or glu-cys-gly required the presence of only a functional Dug1p protein that encoded a protein belonging to the M20A metallohydrolase family, the presence of an unusual peptide bond such as in the dipeptide, gamma-glu-cys, or in GSH, required the participation of the DUG2 and DUG3 gene products as well. The DUG2 gene encodes a protein with a peptidase domain and a large WD40 repeat region, while the DUG3 gene encoded a protein with a glutamine amidotransferase domain. The Dug1p, Dug2p and Dug3p proteins were found to form a degradosomal complex, through Dug1p-Dug2p and Dug2p-Dug3p interactions. A model is proposed for the functioning of the Dug1p/Dug2p/Dug3p proteins as a specific GSH degradosomal complex.