A yeast-based method used to simultaneously identify, and clone the gene for, proteins interacting with a known protein. The basis of this method is a "transcriptional reporter assay" (see definition) in which reporter gene expression is dependent on two domains. The first domain is linked to the known protein. The second domain is genetically linked to a library. If the library is screened against the known protein the two domains will interact only if a protein from the library binds the known protein, resulting in transcription activation of the reporter gene, and a blue color. The "blue yeast clone" will contain the gene encoding the newly identified protein.

This definition is in context to Bioinformatic. See more contextual defintions for Yeast 2-hybrid system.