The c-Fes protein-tyrosine kinase regulates the growth and differentiation of diverse cell types, including myeloid hematopoietic cells, vascular endothelial cells, and neurons. Structurally, Fes is composed of a unique N-terminal region with coiled-coil oligomerization motifs, followed by SH2 and kinase domains. Although Fes kinase activity is tightly regulated in cells, the structural basis for its negative regulation is not clear. In this report, c-Fes was expressed in Saccharomyces cerevisiae to determine whether regulation is kinase-intrinsic or dependent upon protein factors found in mammalian cells. Wild-type Fes kinase activity was completely repressed in yeast and did not affect cell growth. Mutation or deletion of the more N-terminal c-Fes coiled-coil domain reversed negative regulation, leading to strong kinase activation and suppression of yeast cell growth. Similarly, replacement of the wild-type SH2 domain with that of v-Src induced strong kinase activation and the growth-inhibitory phenotype. Immunoblotting with phosphospecific antibodies shows that activation of Fes by either mechanism induced autophosphorylation of the activation loop tyrosine residue (Tyr 713). These data support the idea that Fes naturally adopts an inactive conformation in vivo, and that maintenance of the inactive structure requires the coiled-coil and SH2 domains.