In the yeast Saccharomyces cerevisiae, actin filaments function to direct cell growth to the emerging bud. Yeast has a single essential actin gene, ACT1. Diploid cells containing a single copy of ACT1 are osmosensitive (Osms), i.e., they fail to grow in high osmolarity media (D. Shortle, unpublished observations cited by Novick, P., and D. Botstein. 1985. Cell. 40:415-426). This phenotype suggests that an underlying physiological process involving actin is osmosensitive. Here, we demonstrate that this physiological process is a rapid and reversible change in actin filament organization in cells exposed to osmotic stress. Filamentous actin was stained using rhodamine phalloidin. Increasing external osmolarity caused a rapid loss of actin filament cables, followed by a slower redistribution of cortical actin filament patches. In the recovery phase, cables and patches were restored to their original levels and locations. Strains containing an act1-1 mutation are both Osms and temperature-sensitive (Ts) (Novick and Botstein, 1985). To identify genes whose products functionally interact with actin in cellular responses to osmotic stress, we have isolated extragenic suppressors which revert only the Osms but not the Ts phenotype of an act1-1 mutant. These suppressors identify three genes, RAH1-RAH3. Morphological and genetic properties of a dominant suppressor mutation suggest that the product of the wild-type allele, RAH3+, is an actin-binding protein that interacts with actin to allow reassembly of the cytoskeleton following osmotic stress.