SAR1, the yeast gene which encodes a novel type of small GTP-binding protein, has been shown to be required for protein transport from the endoplasmic reticulum (ER) to the Golgi apparatus. To further the understanding of the function of its product, a lacZ-SAR1 hybrid gene was constructed and a polyclonal antibody was raised against the hybrid protein. This antibody specifically recognizes the SAR1 gene product (Sar1p) as a 23-kDa protein in the yeast cell lysate. We examined the subcellular localization of Sar1p using this antibody. In wild-type cells, Sar1p was predominantly recovered in a rapidly sedimenting membrane fraction that includes the ER. The soluble form of Sar1p was also detected when the protein was overproduced. Immunofluorescence microscopy with the anti-Sar1p antibody showed perinuclear staining that was exaggerated in the ER-accumulating sec18 mutant. Membrane association of Sar1p was shown to be very tight. Sar1p was not extracted from the membrane by treatment with alkaline sodium carbonate, and only 1% deoxycholic acid solubilized Sar1p completely. From these results, we suggest that Sar1p is firmly located on the ER membrane where it regulates the ER-Golgi traffic.