HAC1 encodes the basic-leucine zipper (bZIP) transcription factor that executes the transcriptional arm of the unfolded protein response (UPR) in Saccharomyces cerevisiae. HAC1 mRNA is constitutively transcribed but translationally silenced by base pairing between its intron and 5' UTR; upon accumulation of unfolded proteins in the endoplasmic reticulum, the ER-membrane kinase/endoribonuclease Ire1 excises the intron and tRNA ligase Trl1 joins the exons, allowing synthesis of the active Hac1i protein. Hac1i is a nuclear protein that binds the UPR element (UPRE, core CAGCGTG) in the promoters of genes encoding ER chaperones, folding enzymes, ER-associated degradation components and secretory pathway and lipid-synthesis proteins (e.g. KAR2, PDI1, EUG1, FKB2), activating their transcription. The spliced C-terminal tail stabilizes the otherwise rapidly degraded protein. Hac1i also acts as a repressor of early meiotic genes through association with the Rpd3-Sin3 histone deacetylase, linking ER stress to inhibition of meiosis and other nitrogen-starvation differentiation programs. Hac1 is the functional counterpart of metazoan XBP1. Basal Hac1-dependent UPR activity is also needed in unstressed cells: hac1 and ire1 mutants grow poorly and repeatedly acquire adaptive aneuploidies that counteract ER folding stress, which re-supplying Hac1 or a UPR-independent ER chaperone prevents.