An Aspergillus nidulans functional cDNA encoding an alcohol dehydrogenase (ADH) was isolated by its ability to complement an adh1 mutation in Saccharomyces cerevisiae. Alignment of the cDNA and cloned genomic DNA sequences indicated that the ADH gene contains two small introns. The presence of ethanol in the growth medium was shown to result in ADH mRNA accumulation presumably due to transcriptional induction of the gene. However, ADH mRNA accumulation was at most only partially repressed by the presence of glucose. The ADH gene characterized here is designated ADH3 since it is distinct from the alcA gene which encodes ADH I and appears distinct from the gene which encodes ADH II. We demonstrated that the first intron in the A. nidulans ADH3 gene was not efficiently spliced in S. cerevisiae whereas the promoter region was utilized weakly. We also present a comparison of the primary structure of A. nidulans ADH III with the alcohol dehydrogenases of S. cerevisiae and Schizosaccharomyces pombe.