The cytoplasmic localization of messenger RNA creates an asymmetric distribution of proteins that specify cell fate during development in multicellular eukaryotes. The protein Ash1 is a cell-fate determinant in budding yeast which localizes preferentially to the presumptive daughter nucleus, where it inhibits mating-type switching. Here we show that Ash1 mRNA is localized to the distal tip of daughter buds in post-anaphase cells. Three-dimensional imaging reveals that Ash1 mRNA is assembled into particles that associate with the cell cortex. To achieve this localization, Ash1 mRNA must have its 3' untranslated region and the actin cytoskeleton must be intact. Ash1 mRNA is not localized correctly in the absence of a myosin (Myo4) and is mislocalized to the mother-bud neck in the absence of a regulator of the actin cytoskeleton known as Bnil. We propose that Ash1 mRNA particles are transported into the daughter bud along actin filaments and are anchored at the distal tip. Thus, as in higher eukaryotes, Saccharomyces cerevisiae employs RNA localization to generate an asymmetric distribution of proteins and hence to determine cell fate.