Inheritance of the endoplasmic reticulum (ER) requires Ptc1p, a type 2C protein phosphatase of Saccharomyces cerevisiae . Genetic analysis indicates that Ptc1p is needed to inactivate the cell wall integrity (CWI) MAP kinase, Slt2p. Here we show that under normal growth conditions, Ptc1p inactivates Slt2p just as ER tubules begin to spread from the bud tip along the cortex. In ptc1Δ cells, the propagation of cortical ER from the bud tip to the periphery of the bud is delayed by hyperactivation of Slt2p. The pool of Slt2p that controls ER inheritance requires the CWI pathway scaffold, Spa2p, for its retention at the bud tip, and a mutation within Slt2p that prevents its association with the bud tip blocks its role in ER inheritance. These results imply that Slt2p inhibits a late step in ER inheritance by phosphorylating a target at the tip of daughter cells. The PI4P5-kinase, Mss4p, is an upstream activator of this pool of Slt2p. Ptc1p-dependant inactivation of Slt2p is also needed for mitochondrial inheritance; however, in this case, the relevant pool of Slt2p is not at the bud tip.