We have examined the effects of low concentrations of the alkylating agent N-methyl-N'-nitro-N-nitrosoguanidine (MNNG) on survival and mutagenesis of logarithmically growing Saccharomyces cerevisiae. Pretreatment of cells with nontoxic and submutagenic concentrations of MNNG for several generations does not reduce the cytotoxic and mutagenic effects of exposure to a high concentration of drug. This lack of 'adaptation' in S. cerevisiae was further investigated biochemically and cell extracts prepared from pretreated cells were shown to be deficient in the ability to remove O6-methyl guanine from alkylated DNA. Moreover, we could not detect transfer of the methyl group from the DNA to a protein acceptor in yeast cell extracts suggesting that the level of O6-methyl guanine transferase is below 200 molecules/cell following pretreatment. Exposure of S. cerevisiae to mutagenic concentrations of MNNG stimulates transcription of at least three DNA damage responsive genes that also respond to UV-irradiation and 4-nitroquinoline-1-oxide treatment. These results support the contention that in Saccharomyces alkylation damage is processed by repair pathways that operate on a variety of lesions, and that one or more of these pathways is inducible.