Nucleoside diphosphates generated by glycosyltransferases in the fungal, plant, and mammalian cell secretory pathways are converted into monophosphates to relieve inhibition of the transferring enzymes and provide substrates for antiport transport systems by which the entrance of nucleotide sugars from the cytosol into the secretory pathway lumen is coupled to the exit of nucleoside monophosphates. Analysis of the yeast Schizosaccharomyces pombe genome revealed that it encodes two enzymes with potential nucleoside diphosphatase activity, Spgda1p and Spynd1p. Characterization of the overexpressed enzymes showed that Spgda1p is a GDPase/UDPase, whereas Spynd1p is an apyrase because it hydrolyzed both nucleoside tri and diphosphates. Subcellular fractionation showed that both activities localize to the Golgi. Individual disruption of their encoding genes did not affect cell viability, but disruption of both genes was synthetically lethal. Disruption of Spgda1+ did not affect Golgi N- or O-glycosylation, whereas disruption of Spynd1+ affected Golgi N-mannosylation but not O-mannosylation. Although no nucleoside diphosphatase activity was detected in the endoplasmic reticulum (ER), N-glycosylation mediated by the UDP-Glc:glycoprotein glucosyltransferase (GT) was not severely impaired in mutants because first, no ER accumulation of misfolded glycoproteins occurred as revealed by the absence of induction of BiP mRNA, and second, in vivo GT-dependent glucosylation monitored by incorporation of labeled Glc into folding glycoproteins showed a partial (35-50%) decrease in Spgda1 but was not affected in Spynd1 mutants. Results show that, contrary to what has been assumed to date for eukaryotic cells, in S. pombe nucleoside diphosphatase and glycosyltransferase activities can localize to different subcellular compartments. It is tentatively suggested that ER-Golgi vesicle transport might be involved in nucleoside diphosphate hydrolysis.