Saccharomyces cerevisiae has been used as a model system to investigate the mechanisms of pre-mRNA splicing but only a few examples of alternative splice site usage have been described in this organism. Using RNA-Seq analysis of nonsense-mediated mRNA decay (NMD) mutant strains, we show that many S. cerevisiae intron-containing genes exhibit usage of alternative splice sites, but many transcripts generated by splicing at these sites are non-functional because they introduce premature termination codons, leading to degradation by NMD. Analysis of splicing mutants combined with NMD inactivation revealed the role of specific splicing factors in governing the use of these alternative splice sites and identified novel functions for Prp17p in enhancing the use of branchpoint-proximal upstream 3' splice sites and for Prp18p in suppressing the usage of a non-canonical AUG 3'-splice site in GCR1. The use of non-productive alternative splice sites can be increased in stress conditions in a promoter-dependent manner, contributing to the down-regulation of genes during stress. These results show that alternative splicing is frequent in S. cerevisiae but masked by RNA degradation and that the use of alternative splice sites in this organism is mostly aimed at controlling transcript levels rather than increasing proteome diversity.