Saccharomyces cerevisiae responds to elevated levels of hydrogen peroxide in its environment via a redox relay system comprising the thiol peroxidase Gpx3 and transcription factor Yap1. In this signaling pathway, a central unresolved question is whether cysteine sulfenic acid modification of Gpx3 is required for Yap1 activation in cells. Here we report that cell-permeable chemical probes, which are selective for sulfenic acid, inhibit peroxide-dependent nuclear accumulation of Yap1, trap the Gpx3 sulfenic acid intermediate, and block formation of the Yap1-Gpx3 intermolecular disulfide directly in cells. In addition, we present electrostatic calculations that show cysteine oxidation is accompanied by significant changes in charge distribution, which might facilitate essential conformational rearrangements in Gpx3 during catalysis and intermolecular disulfide formation with Yap1.