The mitochondrial heat shock protein Hsp78 is a member of the Hsp104/Clp family with unknown function. Saccharomyces cerevisiae deletion mutants of HSP78 show wild-type like growth. We report that deletion of the HSP78 gene in yeast strains with point mutations in the SSC1 gene (encoding matrix Hsp70) led to loss of mitochondrial DNA, indicating that at least one of the heat shock proteins Hsp78 and mt-Hsp70 is needed to maintain a rho+ state of the mitochondrial genome. Mitochondria isolated from these double mutants had a strongly reduced membrane potential, explaining defects in the rate of preprotein import. The lack of Hsp78 led to aggregation of the mutant mt-Hsp70 while other matrix chaperones stayed soluble. We conclude that Hsp78 is required to keep mutant forms of mt-Hsp70 soluble and suggest a cooperation of Hsp78 and mt-Hsp70 in maintenance of essential mitochondrial functions.