The thioredoxin system, consisting of thioredoxin, thioredoxin reductase and NADPH, is known to protect cells against oxidative stress. This disulphide reducing system is present in Cryptococcus neoformans and consists of two small, dithiol thioredoxin proteins and one thioredoxin reductase. In this study, we describe the thioredoxin proteins, Trx1 and Trx2, and present their importance not only to stress resistance, but also to the virulence of C. neoformans. Using real-time polymerase chain reaction, we show the induction of both thioredoxin genes during oxidative and nitrosative stress. We describe through deletion studies that the trx1delta mutant has a severe growth defect and is sensitive to multiple stresses, while the trx2delta mutant is only sensitive to nitric oxide stress. Using gene replacement studies, we demonstrate that the thioredoxin protein products are partially redundant in function, but there is differential gene regulation which is especially important to nitrosative stress resistance. We have also identified two putative transcription factors, Atf1 and Yap4, which appear to differentially regulate the thioredoxin system under different conditions. Atf1 is necessary for oxidative stress induction, and Yap4 is necessary for nitrosative stress induction of the thioredoxin genes in C. neoformans. While these two putative transcription factors each appear to be dispensable for survival in macrophages and virulence in mice, we show the more highly expressed thioredoxin, TRX1, is necessary for survival of C. neoformans in the oxidative environment of macrophages and important for virulence of this fungal pathogen.