Pyrimidine bases are the central precursors for RNA and DNA, and their intracellular pools are determined by de novo, salvage and catabolic pathways. In eukaryotes, degradation of uracil has been believed to proceed only via the reduction to dihydrouracil. Using a yeast model, Saccharomyces kluyveri, we show that during degradation, uracil is not reduced to dihydrouracil. Six loci, named URC1-6 (for uracil catabolism), are involved in the novel catabolic pathway. Four of them, URC3,5, URC6, and URC2 encode urea amidolyase, uracil phosphoribosyltransferase, and a putative transcription factor, respectively. The gene products of URC1 and URC4 are highly conserved proteins with so far unknown functions and they are present in a variety of prokaryotes and fungi. In bacteria and in some fungi, URC1 and URC4 are linked on the genome together with the gene for uracil phosphoribosyltransferase (URC6). Urc1p and Urc4p are therefore likely the core components of this novel biochemical pathway. A combination of genetic and analytical chemistry methods demonstrates that uridine monophosphate and urea are intermediates, and 3-hydroxypropionic acid, ammonia and carbon dioxide the final products of degradation. The URC pathway does not require the presence of an active respiratory chain and is therefore different from the oxidative and rut pathways described in prokaryotes, although the latter also gives 3-hydroxypropionic acid as the end product. The genes of the URC pathway are not homologous to any of the eukaryotic or prokaryotic genes involved in pyrimidine degradation described to date.