Previous results suggest that methylotrophic yeasts may contain factors that modulate prion stability. Alcohol oxidase (AOX), a key enzyme in methanol metabolism, is an abundant protein that is specific to methylotrophic yeasts. We examined the effect of Pichia pastoris AOX1 on prion phenotypes in Saccharomyces cerevisiae. The S. cerevisiae prion states [PSI(+)] and [URE3] arise from aggregation of the proteins Sup35p and Ure2p respectively, and correlate with the ability of Sup35p and Ure2p to form amyloid-like fibrils in vitro. We found that expression of P. pastoris AOX1 in S. cerevisiae had no effect on propagation of the [PSI(+)] prion, but inhibited propagation of [URE3]. Addition of AOX1 early in the time-course of fibril formation inhibits Ure2p fibril formation in vitro. AOX1 has not previously been identified as an ATPase. However, we discovered that in addition to its flavin adenine dinucleotide-dependent AOX activity, AOX1 possesses ATPase activity. This study identifies AOX1 as a novel prion inhibitory factor and a potential ATPase.