Endoplasmic reticulum-plasma membrane (ER-PM) junctions are conserved structures defined as regions of the ER that tightly associate with the plasma membrane. However, little is known about the mechanisms that tether these organelles together and why such connections are maintained. Using a quantitative proteomic approach, we identified three families of ER-PM tethering proteins in yeast: Ist2 (related to mammalian TMEM16 ion channels), the tricalbins (Tcb1/2/3, orthologs of the extended synaptotagmins), and Scs2 and Scs22 (vesicle-associated membrane protein-associated proteins). Loss of all six tethering proteins results in the separation of the ER from the PM and the accumulation of cytoplasmic ER. Importantly, we find that phosphoinositide signaling is misregulated at the PM, and the unfolded protein response is constitutively activated in the ER in cells lacking ER-PM tether proteins. These results reveal critical roles for ER-PM contacts in cell signaling, organelle morphology, and ER function.