In Candida albicans, the quorum-sensing molecule farnesol inhibits the transition from yeast to hyphae but has no effect on cellular growth. We show that the addition of exogenous farnesol to cultures of Candida parapsilosis causes the cells to arrest, but not at a specific stage in the cell cycle. The cells are not susceptible to additional farnesol. However, the cells do eventually recover from arrest. Unlike in C. albicans, in C. parapsilosis sterols are localized to the tips of budding cells, and this polarization is disrupted by the addition of farnesol. We used the results of a genome sequence survey to design and manufacture partial genomic microarrays that were applied to determining the transcriptional response of C. parapsilosis to the presence of exogenous farnesol. In both C. albicans and C. parapsilosis, exposure to farnesol results in increased expression of the oxidoreductases GRP2 and ADH7 and altered expression of genes involved in sterol metabolism. There is no effect on expression of C. parapsilosis orthologs of genes involved in hyphal growth in C. albicans. Farnesol therefore differs significantly in its effects on C. parapsilosis and C. albicans.