The genome of the basidiomycete pathogenic yeast Cryptococcus neoformans carries two UDP-glucose epimerase genes (UGE1 and UGE2). UGE2 maps within a galactose cluster composed of a galactokinase homologue gene and a galactose-1-phosphate uridylyltransferase. This clustered organization of the GAL genes is similar to that in most of the hemiascomycete yeast genomes and in Schizosaccharomyces pombe but is otherwise not generally conserved in the fungal kingdom. UGE1 has been identified as necessary for galactoxylomannan biosynthesis and virulence. Here, we show that UGE2 is necessary for C. neoformans cells to utilize galactose as a carbon source at 30 degrees C but is not required for virulence. In contrast, deletion of UGE1 does not affect cell growth on galactose at this temperature. At 37 degrees C, a uge2Delta mutant grows on galactose in a UGE1-dependent manner. This compensation by UGE1 of UGE2 mutation for growth on galactose at 37 degrees C was not associated with upregulation of UGE1 transcription or with an increase of the affinity of the enzyme for UDP-galactose at this temperature. We studied the subcellular localization of the two enzymes. Whereas at 30 degrees C, Uge1p is at least partially associated with intracellular vesicles and Uge2p is on the plasma membrane, in cells growing on galactose at 37 degrees C, Uge1p colocalizes with Uge2p to the plasma membrane, suggesting that its activity is regulated through subcellular localization.