The N-terminal portion of the mitochondrial b-subunit is anchored in the inner mitochondrial membrane by two hydrophobic segments. We investigated the role of the first membrane-spanning segment, which is absent in prokaryotic and chloroplastic enzymes. In the absence of the first membrane-spanning segment of the yeast subunit (subunit 4), a strong decrease in the amount of subunit g was found. The mutant ATP synthase did not dimerize or oligomerize, and mutant cells displayed anomalous mitochondrial morphologies with onion-like structures. This phenotype is similar to that of the null mutant in the ATP20 gene that encodes subunit g, a component involved in the dimerization/oligomerization of ATP synthase. Our data indicate that the first membrane-spanning segment of the mitochondrial b-subunit is not essential for the function of the enzyme since its removal did not directly alter the oxidative phosphorylation. It is proposed that the unique membrane-spanning segment of subunit g and the first membrane-spanning segment of subunit 4 interact, as shown by cross-linking experiments. We hypothesize that in eukaryotic cells the b-subunit has evolved to accommodate the interaction with the g-subunit, an associated ATP synthase component only present in the mitochondrial enzyme.