The product of the Saccharomyces cerevisiae K+-channel gene YKC1 includes two pore-loop sequences that are thought to form the hydrophilic lining of the pore. Gating of the channel is promoted by membrane depolarization and is regulated by extracellular K+ concentration ([K+](o)) both in the yeast and when expressed in Xenopus oocytes, Analysis of the wild-type current now shows that: (i) [K+](o) suppresses a very slowly relaxing component, accelerating activation; (ii) [K+](o) slows deactivation in a dose-dependent fashion; and (iii) Rb+, Cs+ and, to a lesser extent, Na+ substitute for K+ in its action on gating, We have identified single residues, L293 and A428, at equivalent positions within the two pore loops that affect the [K+](o) sensitivity. Substitution of these residues gave channels with reduced sensitivity to [K+](o) in macroscopic current kinetics and voltage dependence, but had only minor effects on selectivity among alkali cations in gating and on single-channel conductance, In some mutants, activation was slowed sufficiently to confer a sigmoidicity to current rise at low [K+](o). The results indicate that these residues are involved in [K+](o) sensing. Their situation close to the permeation pathway points to an interaction between gating and permeation.