The farnesylated SNARE (N-ethylmaleimide-sensitive factor attachment protein receptor) Ykt6 mediates protein palmitoylation at the yeast vacuole by means of its amino-terminal longin domain. Ykt6 is localized equally to membranes and the cytosol, although it is unclear how this distribution is mediated. We now show that Ykt6 is released efficiently from vacuoles during an early stage of yeast vacuole fusion. This release is dependent on the disassembly of vacuolar SNAREs (priming). In recent literature, it had been demonstrated for mammalian Ykt6 that the membrane-bound form is both palmitoylated and farnesylated at its carboxy-terminal CAAX box, whereas soluble Ykt6 is only farnesylated. In agreement with this, we find that yeast Ykt6 becomes palmitoylated in vitro at its C-terminal CAAX motif. Mutagenesis of the potential palmitoylation site in yeast Ykt6 prevents stable membrane association and is lethal. On the basis of these and other findings, we speculate that Ykt6 is released from membranes by depalmitoylation. Such a mechanism could enable recycling of this lipid-anchored SNARE from the vacuole independent of retrograde transport.