Extensive perexisome proliferation during growth on oleic acid, combined with the availability of excellent genetic tools, makes the dimorphic yeast, Yarrowia lipolytica, a powerful model system to study the molecular mechanisms involved in peroxisome biogenesis. A combined genetic, biochemical, and morphological approach has revealed that the endoplasmic reticulum (ER) plays an essential role in the assembly of functional peroxisomes in this yeast. The trafficking of some membrane proteins to the peroxisomes occurs via the ER, results in their glyco-sylation in the ER lumen, does not involve transit through the Golgi, and requires the products of the SEC238, SRP54, PEX1, and PEX6 genes. The authors' data suggest a model for protein import into peroxisomes via two subpopulations of ER-derived vesicles that are distinct from secretory vesicles. A kinetic analysis of the trafficking of peroxisomal proteins in vivo has demonstrated that membrane and matrix proteins are initially targeted to multiple vesicular precursors that represent intermediates in the assembly pathway of peroxisomes. The authors have also recently identified a novel cytosolic chaperone, Pex20p, that assists in the oligomerization of thiolase in the cytosol and promotes its targeting to the peroxisome. These data provide the first evidence that a chaperone-assisted folding and oligomerization of thiolase in the cytosol is required for the import of this protein into the peroxisomal matrix.