Protoheme (hereafter referred to as heme) is an essential cellular cofactor and signaling molecule that is also potentially cytotoxic. To mitigate heme toxicity， heme synthesis and degradation are tightly coupled to heme utilization in order to limit the intracellular concentration of "free" heme. Such a model， however， would suggest that a readily accessible steady-state， bioavailable labile heme (LH) pool is not required for supporting heme-dependent processes. Using the yeast as a model and fluorescent heme sensors， site-specific heme chelators， and molecular genetic approaches， we found here that 1) yeast cells preferentially use LH in heme-depleted conditions; 2) sequestration of cytosolic LH suppresses heme signaling; and 3) lead (Pb) stress contributes to a decrease in total heme， but an increase in LH， which correlates with increased heme signaling. We also observed that the proteasome is involved in the regulation of the LH pool and that loss of proteasomal activity sensitizes cells to Pb effects on heme homeostasis. Overall， these findings suggest an important role for LH in supporting heme-dependent functions in yeast physiology.