The Saccharomyces cerevisiae alg3-1 mutant is described as defective in the biosynthesis of dolichol-linked oligosaccharides (Huffaker and Robbins, Proc. Natl. Acad. Sci. USA, 80, 7466-7470, 1983). Man5GlcNAc2-PP-Dol accumulates in alg3 cells and Endo H resistant carbohydrates are transferred to protein by the oligosaccharyltransferase complex. In this study, we describe the cloning of the ALG3 locus by complementation of the temperature sensitive growth defect of the alg3 stt3 double mutant. The isolated ALG3 gene complements both the defect in the biosynthesis of lipid-linked oligosaccharides of the alg3-mutant and the under-glycosylation of secretory proteins. The inactivation of the nonessential ALG3 gene results in the accumulation of lipid-linked Man5GlcNac2 and protein-bound carbohydrates which are completely Endo H resistant. The ALG3 locus encodes a potential ER-transmembrane protein of 458 amino acids (53 kDa) with a C-terminal KKXX-retrieval sequence.