Mitochondria are responsible for the synthesis of both iron-sulfur clusters and heme, but the potential connection between the two major iron-consuming pathways is unknown. Here, we have shown that mutants in the yeast mitochondrial iron-sulfur cluster (ISC) assembly machinery displayed reduced cytochrome levels and diminished activity of the heme-containing cytochrome c oxidase, in addition to iron-sulfur protein defects. In contrast, mutants in components of the mitochondrial ISC export machinery, which are specifically required for maturation of cytosolic iron-sulfur proteins, were not decreased in heme synthesis or cytochrome levels. Heme synthesis does not involve the function of mitochondrial ISC components, because immunological depletion of various ISC proteins from mitochondrial extracts did not affect the formation and amounts of heme. The heme synthesis defects of ISC mutants were found in vivo in isolated mitochondria and in mitochondrial detergent extracts and were confined to an inhibition of ferrochelatase, the enzyme catalyzing the insertion of iron into protoporphyrin IX. In support of these findings, immunopurification of ferrochelatase from ISC mutants restored its activity to wild-type levels. We conclude that the reversible inhibition of ferrochelatase is the molecular reason for the heme deficiency in ISC assembly mutants. This inhibitory mechanism may be used for regulation of iron distribution between the two iron-consuming processes.