Cholesterol and fatty acid synthesis in mammals are controlled by SREBPs, a family of membrane bound transcription factors. Our studies identified homologs of SREBP, its binding partner SCAP, and the ER retention protein Insig in Schizosaccharomyces pombe, named sre1+, scp1+, and ins1+. Like SREBP, Sre1 is cleaved and activated in response to sterol depletion in a Scp1-dependent manner. Microarray analysis revealed that Sre1 activates sterol biosynthetic enzymes as in mammals, and, surprisingly, Sre1 also stimulates transcription of genes required for adaptation to hypoxia. Furthermore, Sre1 rapidly activates these target genes in response to low oxygen and is itself required for anaerobic growth. Based on these findings, we propose and test a model in which Sre1 and Scp1 monitor oxygen-dependent sterol synthesis as an indirect measure of oxygen supply and mediate a hypoxic response in fission yeast.