Abstract: The invention provides a system for assaying protein-protein interactions. Amino acid sequences of interest are inserted into `bait` and `prey` fusion proteins. The bait fusion proteins include a DNA-binding domain. The prey fusion proteins include a transcriptional repression domain. The interaction of the bait and prey fusion proteins is detected by the repression of reporter genes. The reporter genes have operator sequences to which the DNA-binding domain of the bait fusion protein can bind. The reporter genes are expressed unless the prey fusion protein interacts with a bait fusion protein at the operator region of the reporter gene. When a prey fusion protein binds to a bait fusion protein, the expression of the reporter gene is repressed. Compounds that interfere with the interaction of bait and prey fusion proteins may be detected by their ability to reverse the repression of the reporter genes.