Inactivation of peroxisomal enzymes in the yeast Hansenula polymorpha was studied following transfer of cells into cultivation media in which their activity was no longer required for growth. After transfer of methanol-grown cells into media containing glucose - a substrate that fully represses alcohol oxidase synthesis - the rapid inactivation of alcohol oxidase and catalase was paralleled by a disappearance of alcohol oxidase and catalase protein. The rate and extent of this inactivation was dependent upon conditions of cultivation of cells prior to their transfer. This carbon catabolite inactivation of alcohol oxidase was paralleled by degradation of peroxisomes which occurred by means of an autophagic process that was initiated by the formation of a number of electron-dense membranes around the organelles to be degraded. Sequestration was confined to peroxisomes; other cell-components such as ribosomes were absent in the sequestered cell compartment. Also, cytochemically, hydrolytic enzymes could not be demonstrated in these autophagosomes. The vacuole played a major role in the subsequent peroxisomal breakdown since it provided the enzymes required for proteolysis. Two basically similar mechanisms were observed with respect to the administration of vacuolar enzymes into the sequestered cell compartment. The first mechanism involved incorporation of a small vacuolar vesicle into the sequestered cell compartment. The delimiting membrane of this vacuolar vesicle subsequently disrupted, thereby exposing the contents of the sequestered cell compartment to vacuolar hydrolases which then degraded the peroxisomal proteins. The second mechanism, observed in cells which already contained one or more autophagic vacuoles, included fusion of the delimiting membranes of an autophagosome with the membrane surrounding an autophagic vacuole which led to migration of the peroxisome inside the latter organelle. Peroxisomes of methanol-grown H. polymorpha were degraded individually. In one cell 2 or 3 peroxisomes might be subject to degradation at the same time, but they were never observed together in one autophagosome. However, fusions of autophagic vacuoles in one cell were frequently observed. After inhibition of the cell's energy-metabolism by cyanide ions or during anaerobic incubations the formation of autophagosomes was prevented and degradation was not observed.