The term 'yeast' is often taken as a synonym for Saccharomyces cerevisiae, but the phylogenetic diversity of yeasts is illustrated by their assignment to two taxonomic classes of fungi, the ascomycetes and the basidiomycetes. Subdivision of taxa within their respective classes is usually made from comparisons of morphological and physiological features whose genetic basis is often unknown. Application of molecular comparisons to questions in yeast classification offers an unprecedented opportunity to re‐evaluate current taxonomic schemes from the perspective of quantitative genetic differences. This review examines the impact of molecular comparisons, notably rRNA/rDNA sequence divergence, on the current phenotypically defined classification of yeasts. Principal findings include: 1) budding ascomycetous yeasts are monophyletic and represent a sister group to the filamentous ascomycetes, 2) fission yeasts are ancestral to budding and filamentous ascomycetes, 3) the molecular phylogeny of basidiomycetous yeasts is generally congruent with type of hyphal septum, presence or absence of teliospores in the sexual state, and occurrence of cellular xylose.