Glucose, the most abundant carbon and energy source, regulates the expression of genes required for its own efficient metabolism. In the yeast Saccharomyces cerevisiae, glucose induces the expression of the hexose transporter (HXT) genes by modulating the activity of the transcription factor Rgt1 that functions as a repressor when glucose is absent. However, in the presence of high concentrations of glucose, Rgt1 is converted from a repressor to an activator and is required for maximal induction of HXT1 gene expression. We report that Rgt1 binds to the HXT1 promoter only in the absence of glucose, suggesting that Rgt1 increases HXT1 gene expression at high levels of glucose by an indirect mechanism. It is likely that Rgt1 stimulates the expression of an activator of the HXT1 gene at high concentrations of glucose. In addition, we demonstrate that Rgt1 becomes hyperphosphorylated in response to high glucose levels and that this phosphorylation event is required for Rgt1 to activate transcription. Furthermore, Rgt1 lacks the glucose-mediated phosphorylation in the snf3 rgt2 and grr1 mutants, which are defective in glucose induction of HXT gene expression. In these mutants, Rgt1 behaves as a constitutive repressor independent of the carbon source. We conclude that phosphorylation of Rgt1 in response to glucose is required to abolish the Rgt1-mediated repression of the HXT genes and to convert Rgt1 from a transcriptional repressor to an activator.