Alkylating agents chemically modify DNA and cause mutations that lead to cancer. In the budding yeast Saccharomyces cerevisiae, resistance to the alkylating agent methyl methanesulfonate (MMS) is mediated in part by Dap1p (damage resistance protein 1). Dap1p is related to cytochrome b 5, which activates cytochrome P450 proteins, elevating the metabolism of lipids and xenobiotic compounds. We have found that Dap1p, like cytochrome b 5, binds to heme and that Dap1p targets the cytochrome P450 protein Erg11p/Cyp51p. Genetic analysis indicates that Erg11p acts downstream of Dap1p. Furthermore, Dap1p regulates the stability of Erg11p, and Erg11p is stabilized in dap1Δ cells by the addition of heme. Thus, Dap1p utilizes heme to stabilize Erg11p, which in turn regulates ergosterol synthesis and MMS resistance. Dap1p homologues have been identified in numerous eukaryotes, including mammals, suggesting that the Dap1p-cytochrome P450 protein pathway is broadly conserved in eukaryotic species.